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What Is Covered By Homeowners Insurance?

The homeowners policy contains two sections. Section I provides property coverages (A, B, C and D) while Section II provides liability coverages (E and F). A brief description of the individual coverages follows:

  • Coverage A - Dwelling
  • Coverage B - Other Structures
  • Coverage C - Personal Property
  • Coverage D - Loss of Use
  • Coverage E - Personal Liability
  • Coverage F - Medical Payments to Others

Coverage A - Dwelling

Coverage A provides major property coverage that protects your house and attached structures if it is damaged by a covered peril.

Coverage B - Other Structures

This coverage provides protections to other structures on the residence premises that are not attached to the dwelling. Items covered include detached garages, tool sheds, etc. Coverage B is normally limited to 10% of the coverage A limit. However, you may purchase more coverage for an additional premium.

Coverage C - Personal Property

This coverage provides protection for the contents of your home and other personal belongings owned by you and other family members who live with you. Coverage C is normally 50% of coverage A or is subject to an established amount agreed upon by you and the insurance company.

Coverage is limited on certain types of property that are especially susceptible to loss, such as:

  • Jewelry
  • Furs
  • Fine Arts
  • Silverware
  • Antiques
  • Collectibles
  • Firearms
  • Money

Additional amounts of insurance may be purchased. You may want to consider scheduling these items separately. Ask your agent for specifics.

Coverage D - Loss of Use

This coverage will help with additional living expenses if your home is damaged by a peril insured against to the extent that you cannot live in your home. These expenses include, but are not limited to, housing, meals and warehouse storage. Coverage D is normally limited to 20 percent of Coverage A.

Coverage E - Personal Liability

This section of the homeowners policy will provide coverage in the event you or a resident of your household are legally responsible for injury to others. Coverage E normally provides a defense and will pay damages, as the insurance company deems appropriate. There are some exceptions. The liability coverage will not protect you in all situations, such as an intentional act. All of the exclusions and specific language can be found in your policy.

Coverage F - Medical Payments to Others

This coverage pays for reasonable medical expenses for persons accidentally injured on your property. For example, if a neighbor's child is injured while playing in your home, the medical payments portion of your homeowner's policy may pay for necessary medical expenses. medical payments coverage does not apply to your injuries or injuries of those who reside in your household. It is not a substitute for health insurance. Business activities are also excluded. All of the exclusions and specific language can be found in your policy.

Perils Generally Covered by a Homeowners Policy if Damage is caused by:

  • Fire or lighting
  • Windstorm or hail
  • Explosion
  • Riot or civil commotion
  • Aircraft
  • Vehicles
  • Smoke
  • Vandalism & malicious mischief
  • Theft
  • Volcanic eruption
  • Falling objects
  • Weight of ice, snow, sleet
  • Sudden & accidental water damage
  • Breakage of glass

Perils Generally not covered by a Homeowners Policy if Damage is caused by:

  • Flood
  • Earthquake
  • Earth movement
  • Termites
  • Insects, rats or mice
  • Water damage cause by seepage or leaks
  • Losses to house vacant for 60 days or more
  • Mold
  • Wear and tear or maintenance
  • War
  • Insurrection
  • Tidal wave
  • Neglect
  • Nuclear hazard

Important: Read exclusions in your insurance contract.

Earthquake, flood, mold, earth movement, and "wear and tear" are some of the perils that are usually excluded. When an insurer writes your homeowners coverage, the insurer is legally obligated to offer you earthquake coverage for an additional premium. The earthquake coverage may be written directly by the homeowner's insurer, by a separate insurer, or through the California Earthquake Authority (CEA).

You may elect to buy specialized homeowners coverage that provides additional protection for your dwelling and contents beyond the standard coverage limitations in most homeowner's policies. Ask your insurance agent or broker about available endorsements to extend coverage. Endorsements to coverage such as building code upgrade can greatly add to your protection in a loss.

 Renters Insurance (Fact Sheet 4/4/11)

News reports of apartment fires often include tragic stories of renters who have lost everything because they weren't insured. Your landlord does not provide insurance for your personal property. Having all your personal possessions destroyed in a fire or other insurable event, without coverage, is a tragedy that does not have to happen.

To protect your belongings, you should consider purchasing renter's insurance, also known as "tenant's insurance." The renter's policy may be used to provide coverage for your personal contents located in the property that you occupy. Coverage is also provided for loss of use, personal liability protection and medical payments to others.

Coverage generally Provided under a Renter's Policy:

  • Coverage C - Personal Property - An amount, designated by the insured, subject to a minimum as determined by your insurance company
  • Coverage D - Loss of Use - 20% of Coverage C
  • Coverage E - Personal Liability - Generally subject to a minimum of $100,000
  • Coverage F - Medical Payments to Others - Generally Subject to a minimum of $1,000

  How Protected Are You as a Renter?

If you are a renter residing in California, by law the building owner is required to maintain insurance on the dwelling he or she rents. All this means is that the house or apartment you rent,the building itself,is insured by the owner, and should something happen to this structure as the result of fire, water damage, etc, the building owner is entitled to file a claim. However, the landlord's insurance does not protect you as a renter. If this same fire or water damage should ruin your sofa, clothes or other personal items, you are not protected against the loss of these items unless you buy a California Renter's Insurance policy. Moreover, if someone becomes injured while on the premises you rent, you could potentially be held liable for any medical and hospital expenses.

  What is Renter's Insurance?

Renter's insurance, also known as "tenant's insurance" is a type of policy offered by most major California insurers. These policies provide protection for your valued assets as well as liability protection in the event someone becomes injured at your residence.

 What is Covered in a California Renter's Insurance Policy?

Renter's insurance typically covers loss or damaged caused by:

  • Fire
  • Smoke
  • Thef
  • Vandalism
  • Windstorm or hail
  • Lighting
  • Explosion
  • Falling objects
  • Weight of snow, ice or sleet
  • Water (caused by plumbing failure, appliance failure, fire sprinklers or other accidental discharges of water)
  • Electrical surges

It also covers:

  • Injuries that others sustain while at your home (including medical expenses and any resulting lawsuits)
  • Damage that you cause to other people's property (ex: you break a neighbor's window while playing ball)
  • Housing costs. If your rental unit is damaged and you need to live elsewhere while it's being repaired, your renters insurance will pay for yoru additional living expenses

 What Your Insurance Will Pay to Replace:

Your renter's insurance policy will pay to replace any property that is stolen, damaged or destroyed by a covered cause. This includes, but is not limited to:

  • Electronics
  • Clothes
  • Furniture
  • Sports equipment
  • Appliances
  • Jewelry (limited)
  • Collectibles (limited)

Important Note: Renter's insurance protects your belongins even when you're away from home. So, if your laptop gets stolen from your car or your bike gets taken from the rack at work, your renter's insurance will pay to replace them.

 Additional Coverage Options:

Need more protection than the basic renter's insurance policy provides? You can add additional riders for:

  • High Value Item Coverage - a good idea if you own jewelry, artwork, antiques, collectibles or firearms with a total value that exceeds your policy's maximum pay out for such items.
  • Earthquake or Flood Coverage - a must-have if you live in an area prone to such conditions. A standard renter's insurance policy does not include coverage for a flood or earthquake.
  • Sewer and Drain Back Up Coverage - back-ups happen more often than you would think, and they cause a lot of damage when they do.
  • Replacement Value Coverage - If you make a claim, you'll be reimbursed for the full replacement cost of your items - rather than the depreciated cash value of your items.
  • Home Business Coverage - Most insurance policies offer very little coverage for business equipment. If you work from home, consider adding a home business rider to boost your equipment and liability coverage.
  • Business Merchandise Coverage - If you store your business' inventory at home, an additional rider will be needed to insure it properly.

 California Renter's Insurance Policy: Things to Remember

  1. Before purchasing a policy, take the time to conduct a complete inventory of all your personal belongings, taking photos or a video of things like furniture, jewelry and expensive electronics items. Calculate the replacement costs for these items and double check with your insurance agent to make certain you are fully protected against any type of loss.
  2. Most insurance companies offer discounts to a policyholder to lower the cost of premiums. Companies may offer discounts for smoke detectors, dead bolts.
  3. Choose the coverage according to your property. If you have a lot of electronics, choosing a policy that provides replacement cost coverage instead of actual cash value coverage might be the best renter's insurance option for you.
  4. Make sure that the policy has liability coverage. The best renter's insurance policies will also include liability coverage for medical and legal costs if someone gets hurt in your renter residence.
  5. The best renter's insurance policies will also include emergency living expenses. This means that if you have to vacate the property due to damage, the insurance company will pay for you to live somewhere else.
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