What Is Homeowners Insurance?

What a standard policy covers

A typical HO-3 policy covers the dwelling, other structures, personal property, loss of use, and personal liability. Coverage on the dwelling is based on the cost to rebuild, which can be higher or lower than market value.

Common exclusions

Flood and earthquake are excluded from standard policies and require separate coverage. Damage from neglected maintenance, wear, and certain water intrusion is also typically excluded. In high-risk regions, wind, hail, or wildfire may carry a separate, larger deductible.

Controlling the cost

Raising your deductible, bundling with auto insurance, updating roof and systems, and installing monitored alarms all reduce premiums. Shop at renewal — premiums drift upward and carriers price the same house very differently.

Keep reading

• What Is Property Tax?

  How property tax is assessed, escrowed, and how it changes over time.

• What Is an HOA Fee?

  What HOA dues buy, how they rise, and the risk of special assessments.