What is homeowner insurance
Property and liability insurance protects your home and personal property from loss. It includes medical payments coverage in case someone gets hurts on your property, which helps protect your assets if you’re found liable.
Why have homeowner insurance?
Homeowner insurance reimburses you for your financial loss arising from accidental losses such as fire, vandalism and water damage. Homeowner insurance also ensures you are protected against lawsuits arising from your personal actions or ownership of your property. Most banks and mortgage companies will insist that you purchase homeowner insurance before lending you money to buy a home or condo. Most people forget about homeowner insurance when buying a home.
What does homeowner insurance cover?
Building & Detached Structures
Depending on where you live, and the type of home you live in, home insurance coverage will vary. If you own a house, your homeowner insurance policy will cover you house and any detached structures, which includes a garage or a shed.
Your homeowner insurance policy will also cover your personal contents such as your appliances, clothing, electronics and jewellery.
Additional Living Expenses
If your home was deemed unfit to live in or you were denied access into your home by the police or civil authority as a direct result of damage by an insured peril (e.g. fire, smoke, water damage), your homeowner policy offers coverage in the form of "additional living expenses". Your homeowner insurance policy will reimburse you for the additional living expenses while living away from home.
The legal liability portion of your homeowner policy will protect you against lawsuits arising from your personal actions or ownership of your property. For example, it will protect you if a visitor were to slip and fall on you driveway because you failed to shovel a build up of ice and snow.
What determines the cost of homeowner insurance?
There are a wide variety of factors insurance companies consider when deciding how much to charge you for your homeowner insurance. Insurance companies analyze these factors and determine the likelihood that you or a group of people with the same set of circumstances as you will make a claim and how much it will cost. Some of these factors include:
Where you live
Type of heating source
Type of electrical distribution
Age of roof
Primary use of your home
Your claims history
Proximity to fire hydrant and fire station
Proximity to surrounding businesses
Cost to rebuild your home