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The Basics of Home Insurance

Feb 25, 2008
One of the most important things homeowners should concern themselves with is home insurance.

This insurance can protect their home in event of fire or major damages to the property due to things such as a collapsed roof.

Just like any other kind of insurance, there is no basic contract that can be drawn up for everybody. This is because everybody's needs and situations will be different so every contract will be just a little bit different to reflect those needs.

There are however, some home insurance basics that every homeowner should know, starting with the three general categories that home insurance will fall into.

Named Perils is the first category of home insurance. This will protect the homeowner from damage caused to their physical property from natural disasters such as floods, fire, lightning, and windstorms.

Although this is the least expensive type of home insurance, it poses much risk to the homeowner. This is because every threat must be specifically mentioned in the insurance policy or it will not be covered.

Not every homeowner can foresee every situation and so, if a flood occurs in an area that is not known for flooding, the homeowner could be stuck paying the bill. Named Perils also only includes things that will occur naturally so if any unnatural damage occurs, the homeowner will also be solely responsible for paying for any damages.

Broad, or "All Risk" insurance provides coverage that falls right in between the other two categories. This type of home insurance will protect the homeowner from any risk or threat to the home's physical property but for the contents held within, Named Perils must be named specifically.

Just as the policy coverage falls right in between the other two categories, so does the price.

Comprehensive insurance provides for total protection. This includes protection for the home's physical property as well as any contents within that home. Not only does it provide insurance for everything related to the home, it provides coverage for any type of damage and that damage needs not be specifically named.

Basically, it provides protection for any damage to the property or contents regardless of what caused the damage.

Because this coverage does cover everything, it is generally the most expensive insurance homeowners can buy but they can be assured that they are well protected.

An insurance agent will discuss with homeowners what they feel is best depending on the homeowners needs and other factors, such as where they live.

The most expensive is not always the best and the cheapest may not always provide for the best protection so just like everything else, the homeowner must use due diligence when deciding on home insurance.
About the Author
Paige Martin is award winning Houston realtor. Her website features 500+ pages of data and lists all Houston Condoss for sale, including the fantastic Four Leaf Towers Houston. Paige is a member of the Houston, Texas, and National Assoc of Realtors. Paige Martin, Martha Turner Properties.
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