Homeowner's Insurance Glossary

Definition:

Homeowner's insurance policy terminology

For most homeowner's insurance clients their primary residence is by far their biggest single investment. Helping them protect that investment is a primary responsibility. Understanding the key terminology within homeowner's insurance policies is therefore an important step. A homeowners policy covers most losses that may occur to your dwelling and personal property. Commonly, losses resulting from theft, fire, wind, hail or freezing are covered as well as damages caused by explosions, falling objects, certain types of water damage and electrical current and heating system accidents. Damage to your personal property is covered anywhere in the world.

Homeowner's insurance contains two primary coverage components:

• Building coverage
• Contents coverage

Building replacement coverage means your home will be fully repaired or rebuilt without depreciation up to the coverage limit. (Increased costs to re- build as a result of ordinances or laws must be insured separately.) Policies also cover loss of use of your residence premises. If you are unable to occupy your home because of a covered loss, this coverage pays for any reasonable increase in your living expenses necessary to maintain your normal standard of living-including a place to stay, food and transportation.

Building coverage includes:

• The insured building and its foundation,
• The electrical and plumbing system,
• Central air conditioning equipment, furnaces, and water heaters,
• Refrigerators, cooking stoves, and built-in appliances such as dishwashers, and
• Permanently installed carpeting over unfinished flooring.

Also Known As: property casualty coverage home policy coverage benefits loss