Home Insurance: What’s Covered and What’s Not Your home is more than just a building — it’s where you live, make memories, and store everything you value. That’s why having home insurance (also known as homeowners insurance) is so important.
But many homeowners are unsure about what’s actually covered — and just as importantly, what’s not.
In this guide, we’ll break down what home insurance typically includes, what it doesn’t, and what to watch out for in your policy.
What Is Home Insurance?
Home insurance is a policy that protects you financially if your home or belongings are damaged, destroyed, or stolen. It also provides liability coverage in case someone is injured on your property.
You pay a monthly or yearly premium, and in exchange, your insurance company agrees to cover certain risks — as outlined in your policy.
What Home Insurance Covers
Coverage can vary by provider and plan, but most standard policies (HO-3 is the most common in the U.S.) include the following:
1. Dwelling Coverage
This covers the structure of your home — including the walls, roof, floors, and built-in appliances — if they’re damaged by covered events.
Covered events typically include:
- Fire and smoke
- Lightning strikes
- Windstorms or hail
- Explosions
- Vandalism or malicious mischief
- Theft
- Falling objects
- Weight of ice or snow
- Water damage from burst pipes (but not flooding)
Tip: Make sure your coverage amount matches the cost to rebuild, not just your home’s market value.
2. Other Structures
This covers structures not attached to your main house, such as:
- Garages
- Sheds
- Fences
- Guesthouses
Usually, this coverage is a percentage of your dwelling limit (e.g., 10%).
3. Personal Property
Covers your belongings inside the home — like furniture, electronics, clothing, and appliances — if they’re stolen or damaged by a covered event.
Includes:
- Theft (even outside your home, like luggage stolen on vacation)
- Fire or smoke damage
- Vandalism
- Some types of water damage
Note: High-value items like jewelry, art, or collectibles may have coverage limits. You’ll need extra riders for full protection.
4. Loss of Use (Additional Living Expenses)
If your home becomes uninhabitable due to a covered event, your insurer will pay for temporary housing and related expenses (like meals, hotel stays, laundry, etc.).
5. Personal Liability
Covers legal costs if someone is injured on your property or if you accidentally damage someone else’s property.
Examples:
- A guest slips on your icy driveway and sues you.
- Your kid throws a ball through a neighbor’s window.
6. Medical Payments to Others
Pays for minor medical expenses if someone is hurt on your property, regardless of fault — without going through a lawsuit.
What Home Insurance Doesn’t Cover
While homeowners insurance covers a lot, it doesn’t protect against everything. Here are some common exclusions:
1. Flooding
Standard home insurance does not cover flood damage caused by heavy rain, overflowing rivers, or storm surge.
To be protected, you need a separate flood insurance policy, often through FEMA’s National Flood Insurance Program (NFIP).
2. Earthquakes and Sinkholes
Most policies exclude earth movement like earthquakes, landslides, or sinkholes.
Earthquake coverage can be added separately through an endorsement or a stand-alone policy.
3. Maintenance and Wear & Tear
Insurance won’t pay for:
- Plumbing leaks due to old pipes
- Mold from long-term moisture issues
- Pest infestations
- Roof leaks from age or neglect
🔧 Regular maintenance is the homeowner’s responsibility.
4. Intentional Damage
If you damage your own property on purpose, don’t expect insurance to cover it.
5. Business Activities
Running a business from home? Your policy probably doesn’t cover:
- Business equipment
- Inventory
- Liability from clients visiting your property
💼 Consider a home business rider or separate business insurance.
Optional Add-Ons and Riders
If standard coverage isn’t enough, you can customize your policy with endorsements (also called riders).
Popular add-ons include:
- Flood insurance
- Earthquake insurance
- Jewelry or fine art protection
- Identity theft coverage
- Sewer backup protection
- Home office or business coverage
How to Make a Claim
- Document the damage: Take clear photos or videos.
- Contact your insurer: Report the claim ASAP.
- File paperwork: Provide all required documents.
- Meet with an adjuster: They’ll assess the damage and estimate repair costs.
- Get paid: After approval, you’ll receive a check or direct deposit — minus your deductible.
Tips for Choosing the Right Home Insurance
- Compare quotes from at least 3 companies.
- Make sure coverage limits reflect the rebuild cost, not market value.
- Check for bundle discounts (e.g., home + auto).
- Review your deductible — higher deductibles mean lower premiums, but more out-of-pocket after a claim.
- Ask about local risks (flood zones, earthquakes) and if additional coverage is needed.
Final Thoughts
Home insurance is one of the smartest investments you can make to protect your property, finances, and peace of mind. While it covers a wide range of events — from fires to theft and liability — it’s important to understand what’s not covered so you’re not caught off guard.
Take the time to review your policy, ask questions, and make sure your coverage fits your home and lifestyle.
Because when disaster strikes, the right coverage makes all the difference.