What home insurance covers

Coverage A pays to repair or rebuild the house, its attached structures and its built-in fixtures after a covered peril. Coverage B does the same for detached garages, block walls, sheds, gazebos and pool equipment, usually at a set fraction of the dwelling limit. In the common form both are written on an open-perils basis: anything not listed as excluded is covered, which puts the weight of the policy on the exclusions rather than on a list of named causes.

The dwelling limit should track reconstruction cost, which includes debris removal, permits, and the jump in labor and material prices that follows a regional storm. An extended replacement cost endorsement adds a cushion above the limit for exactly that surge. Underinsuring the dwelling is the most expensive mistake on the form: a partial loss may be paid in full, but a total loss stops at the number on the page.

Coverage C pays for the contents: furniture, clothing, electronics, tools, what is in the kitchen and the garage. It is written on named perils, a shorter list than the dwelling enjoys, and the settlement basis matters more than the limit. Actual cash value pays what a used item was worth; replacement cost pays what a new one costs, with the depreciation released once you buy the replacement and send the receipt. Jewelry, firearms, collectibles, cash and silver carry small sub-limits for theft, which a scheduled personal property endorsement lifts item by item, usually with an appraisal.

When a covered loss makes the house unlivable, this part pays the extra cost of living somewhere else while the repairs are made: a rental, meals beyond your usual grocery bill, boarding for pets. It is written as a dollar limit or a number of months, and it pays only the difference between your normal expenses and the temporary ones. After a wildfire evacuation it can also pay while a civil authority keeps you out of the neighborhood, even if the house itself is untouched.

Personal liability pays when you are legally responsible for injuring someone or damaging their property away from a car: a guest who falls on the stairs, a dog bite at the park, a child's baseball through a neighbor's window. It pays the lawyer as well as the judgment, and the limit is the layer an umbrella policy sits on top of. Medical payments to others pays small medical bills for a guest without anyone proving fault, which is often what keeps a minor injury from turning into a claim against the liability limit.

Most policies carry a single flat deductible for every peril, but in hail country carriers increasingly write a separate wind and hail deductible as a share of the dwelling limit, which on a large house is far more than the flat number. The roof is the other pressure point. An older roof may be settled at actual cash value only, or on a schedule that pays less each year it ages, so a monsoon hailstorm on a fifteen-year-old roof can leave the owner paying most of the replacement. Both facts are on the declarations page or in an endorsement, and both are worth reading before the storm rather than after it.