What Is Homeowners Insurance?
"in Plain English”
A traditional homeowners insurance policy protects your home’s physical structure as well as things around your home (such as a detached garage or shed,) and your personal property (such as furniture,) in the event of a covered loss, like fire or lightning.
What Does Home Insurance Cover?
Homeowners insurance policies will cover your home's actual structure, personal property, personal liability, and medical liability. Altogether there are about 6 different coverage options that make-up a home insurance policy and we cover them below.
Your Dwelling
This type of coverage is usually used to repair or rebuild your home when damage from a covered loss happens. It's always best to purchase your dwelling coverage based on the cost to rebuild your home.
Personal Property
Personal property coverage can cover you if personal items in your home are damaged, stolen or destroyed like furniture and clothes. Your personal property can also be covered even outside of your home.
Other Structures
This is coverage for damage to detached structures that are still a part of your property like garages, sheds, fences, or even a dog house.
Loss Of Use
Loss of use coverage will pay your additional living expenses if you must move out of your home while it's being rebuilt. It will also cover things like rent for properties you own.
Personal Liability
Personal Liability coverage is going to kick in if you or your household are personally responsible for causing bodily harm or property damage to others.
Medical Liability
Medical liability coverage is also called Medical Payments and will usually kick in to cover medical expenses of any guests that may be hurt while at your home.
What Does Homeowners Insurance Not Cover?
Homeowners insurance does not cover damage caused by earthquakes or floods. It doesn’t cover damage from sewer backups, failure to maintain your property, termites, rust, rot, or mold that wasn’t created by a covered loss.
If you live in an area prone to earthquakes or flooding, you should look into purchasing a policy separate from your homeowners policy.
THE SIMPLY INSURANCE WAY
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Get quotes and sign up online without talking to an agent. But, we are here if you need us.
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Coverage in minutes.
You can get home insurance coverage within minutes of getting your quotes and applying.
What Type Of Homeowners Insurance Policy Do I Need?
There are over 8 different types of home insurance products. Each one was created for a specific type of home such as a condo or renters insurance. However, most of us will only deal with one of the 3 primary types of coverage which are HO3, HO4, and HO6.
HO3 - Home
An HO3 policy covers damage to the structure of your home and personal property caused by open perils, lawsuits filed against you, and the costs of temporary relocation. This policy is best for someone who needs coverage for a single family home.
HO4 - Renters
A typical HO4 policy will cover damage to certain parts of your of your rental home and personal property caused by 16 named perils, lawsuits filed against you, and the costs of temporary relocation. This policy is best for anyone who is renting a home or an apartment.
HO6 - Condo
Your HO6 policy protects against damage to certain parts of your condo and personal property caused by 16 named perils, lawsuits filed against you, and the costs of temporary relocation. This policy is best for anyone who is purchasing a condo.
Landlord Insurance - Honorable Mention
Often called buy-to-let home insurance, a Landlord Insurance Policy is insurance for people who rent out a home they own to a tenant. It provides a layer of extra protection because it treats your rental properties as a business.
You don't have to think too much about the type of coverage you will need, most online quotes will ask what type of home you are insuring so you will have the correct policy.
How Much House Insurance Do I Need?
Most homeowners insurance policies come with a minimum of $100,000 in coverage, and on a mortgaged home, they usually cover up to the value of your home. However, you should have at least $300,000 to $500,000 if you can afford it. The final amount of homeowners insurance that you need is going to depend on the costs of replacing several things:
Rebuilding Your Home
You need to make sure that your policy will have enough coverage in it for you to rebuild your entire home based on current costs to rebuild.
Your Home Office
The equipment inside of your home office can't be forgotten about either. Our home offices are just as equipped as actual offices now days so be mindful of the costs.
Refurnishing Your Home
It's easy to stack up over $25,000 in furniture when you think about furnishing your home with dining sets, bedroom sets and other types of chairs and ottomans.
Things Like Art
While some people collect coins and stamps, others (like myself), have an action figure collection. Anything that is considered to have Exceptional Value should be covered.
Your Personal Property
Things like your clothes, shoes or other personal property should be accounted for. You don't want a policy that can't cover all of your personal items due to a covered loss.
Use Our Calculator For Extra Help
We created a pretty cool home insurance calculator that you can use to get a more solid understanding of how much coverage you need.
When you are deciding on how much home owners insurance you need, it's best to act like a detective. You should also determine if you have specific risks like an exotic pet.
Along with the other factors above, come up with a number and if you can afford it, double the amount of coverage, if not, you still have a great starting point.
How Much Does Homeowners Insurance Cost?
The average cost of homeowners insurance is about $1,211 per year; however, several factors play a part in determining how much your coverage will cost. Some 95% of homeowners in the United States have homeowners insurance, but about 60% are under-insured.
What Factors Determine The Cost Of My Homeowners Insurance Policy?
Sample Home Insurance Quotes By Coverage Amount
On average, a home insurance policy for $150,000 to $175,000 in coverage is going to run you about $80.00 per month. Houses in the range of $400,000 to $500,000 will run you about $122.00 per month. We cover more sample quotes below:
COVERAGE AMOUNT | ANNUAL PREMIUM | MONTHLY PREMIUM |
|---|---|---|
$150,000 to $175,000 | $960 / year | $80.00 / month |
$175,000 to $200,000 | $997 / year | $83.08 / month |
$200,000 to $300,000 | $1,092 / year | $91.00 / month |
$300,000 to $400,000 | $1,252 / year | $104.33 / month |
$400,000 to $500,000 | $1,467 / year | $122.25 / month |
$500,000 and Above | $2,149 / year | $179.08 / month |
Our Method: The above sample rates are based on a report created by the NAIC(.pdf).
THE SIMPLY INSURANCE WAY
Home Insurance made easy.
Agents not required.
Get quotes and sign up online without talking to an agent. But, we are here if you need us.
Unbiased, expert advice.
Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.
Coverage in minutes.
You can get home insurance coverage within minutes of getting your quotes and applying.
How To Get Cheap Homeowners Insurance?
Finding an affordable homeowners insurance policy doesn't have to be complicated. In fact, there are a few steps you can take to make sure you get the best price for your policy.
How To Save On Homeowners Insurance?
You can save several ways on homeowners insurance; however, your total savings will be determined by the insurance company you purchase coverage through.
Because each insurance company is different, shopping around is going to be the key to getting the most savings.
However, most of them offer several discounts, including:
How To Buy Homeowners Insurance Online?
Buying home insurance online has never been easier; regardless of whether you are getting insurance on your first home or looking for lower rates, you can get quotes and coverage in minutes.
Believe it or not, it’s only five steps to go from quotes to being covered:
THE SIMPLY INSURANCE WAY
Home Insurance made easy.
Agents not required.
Get quotes and sign up online without talking to an agent. But, we are here if you need us.
Unbiased, expert advice.
Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.
Coverage in minutes.
You can get home insurance coverage within minutes of getting your quotes and applying.
The Best Home Insurance Companies
In my professional opinion, as a licensed agent for over 13 years, the best companies for homeowners insurance are Hippo, Lemonade, and Progressive.
All of them offer an online application process, no waiting periods, and prices that are comparable or sometimes better than the industry standard.
They also have accelerated underwriting processes that allows you to get an instant decision and be covered in minutes.
Super Fast Quotes
Instant Online Coverage
Free Water Leak Sensor
No-Cost Additional Coverage
Check out our Hippo review
Instant Online Coverage
Earthquake Insurance Rider
Lemonade Gives Back
The Zero Everything Service
Check out our Lemonade review
Amazing customer reviews
Discounts for bundling
Easy online chat options
Widespread coverage
Check out our Progressive review
No sure where to start? We review the best homeowners insurance companies for 2021.
Why Trust Simply Insurance?
We make things simple. At Simply Insurance, you get to compare only the top online home insurance companies. We've done all the hard work and picked out the top companies so that you don't have to go through all of the top insurance companies in the nation... I mean, no one really has time for that.
Years of licensed experience. As licensed agents, we help our customers navigate the entire insurance buying process. We don't work on commission and can answer any questions you may have in regards to your insurance policy.
Keeping it in "Plain English." We pride ourselves on creating content that is easy to understand and that doesn't have a ton of "insurance-ese". Insurance education is essential to us and we put our customers needs first.
Frequently Asked Questions
Who has the cheapest home insurance?
According to Bankrate.com, Erie Insurance has the cheapest home insurance with an average annual premium of $1,088. They also score high on their J.D. Power customer satisfaction score of 839 out of 1000.
How much is a typical homeowners insurance policy?
The average cost of homeowners insurance is about $1,211 per year. Some 95% of homeowners in the United States have homeowners insurance, but about 60% are under-insured.
What is the average monthly cost for homeowners insurance?
The average monthly cost of homeowners insurance is about $100.91 per month; however, several factors play a part in determining how much your coverage will cost.
Who has the best home insurance?
According to Usnews.com, Amica has the best home insurance in 2021 based on having the best rates, policies that pay cash dividends, and strong financial strength.
