Is Home Insurance the Same as Homeowners Insurance?
Posted by Preferred Insurance Agency on
To some, it might seem like an obvious question, but a common question many ask us at Preferred Insurance Agency is, “Are Home Insurance and Homeowners Insurance the same thing?” Read on to find the answer.
What Is Homeowners Insurance?
Many people wonder, “Is there a difference between a home insurance policy and homeowners insurance policy?”
Well, there are no differences, but people use these interchangeable phrases to refer to their home insurance policies. Home insurance, property insurance or homeowners insurance are all commonly used interchangeably by people and insurance professionals.
And while house insurance coverage and homeowners insurance coverage are generally the same, things can get a little more tricky.
Homeowners insurance is called so because the policy covers more than your house structure. It protects you, the homeowner, from these six different aspects or protection types for your home during an accident on your property:
Dwelling coverage protects your house structure against covered hazards like fire, wind, hail, and lightning. It is usually enough to rebuild your home entirely if destroyed by a covered event. Flood and earthquake coverage, however, isn’t included.
Other property structures
This coverage protects detached garages, sheds, and fences from covered events. While the coverage limit is usually 10% of dwelling coverage, you can buy more protection if required.
Contents or personal property coverage protects any of your possessions like clothing, furniture, and electronics stolen or destroyed by covered hazards. While it’s typically between 50-70% of your dwelling coverage, it usually covers expensive items like furs and jewelry.
Loss of use coverage
This coverage applies when your home gets inhabitable because of a covered loss or event. The coverage helps with your living expenses, including restaurant and hotel bills incurred while replacing or repairing your home. The coverage is typically 20% of your dwelling coverage limit, but some policies include time limits.
Personal liability coverage
This coverage helps if someone sues you for:
Getting hurt on your property
Getting injured by your pets
Suffering property damage from an event you or your household member caused.
Personal liability coverage pays for your legal defense and any lawsuit settlement up to your coverage limits. While the coverage limit is $100,000, you can always buy extra coverage.
Medical payment coverage
This coverage helps pay the medical bills for parties hurt on your property, but don’t sue. While it pays medical expenses up to your coverage limit of $1,000, you can always buy additional coverage.
When Is Homeowners Insurance Required?
You are not legally required by state or federal law to have homeowners insurance. However, banks do require it as your mortgage condition. So you probably should start getting home insurance quotes once your home offer is accepted.
Besides, as your mortgage company may require a quote to complete the loan process, having a quote smoothens the loan process.
A home insurance policy is also typically required while closing a mortgage loan. Your insurance agent or company will send the documents to your mortgage lender and help you through the process so that there’s no delay in your closing.
Home insurance and Homeowners insurance are the same thing and used interchangeably in the insurance world.
And while a home insurance policy isn’t legally required, it’s worth it because home insurance coverage protects you from enormous financial loss and the costs of any unexpected losses on your property.
Preferred Insurance Agency of La Crosse is the La Crosse area’s top rated insurance company. We have the unique advantage of being able to run your home insurance quote through multiple insurance providers so we can get you the best price for the same home insurance coverage. Visit our La Crosse home insurance page for a homeowners insurance quote.