Learn About the Different Types of Coverage
A basic Texas homeowners insurance policy provides valuable protection. Read on for an explanation of the standard components of a house insurance policy.
This portion of a policy offers several different types of coverage. The first takes care of your dwelling, meaning your home's structure. For example, if a windstorm damaged your roof, the dwelling coverage of your policy would pay for the damages. It also takes care of your other structures, such as sheds, garages, etc. The belongings you keep in your house are shielded by the personal property component of your policy as well. Usually, personal property protection is limited to 50% of your dwelling. For instance, if your house is insured for $200,000, your limit would be $100,000.
Accidents happen all the time, and lawsuits often ensue as a result. To shield you from potentially costly legal judgments that could jeopardize your assets, these policies also include liability protection. The liability portion of the policy has two components: property damage and personal injury. In other words, your liability coverage kicks in if you are found legally liable for injuring someone or damaging another's property. Your liability will pay for your legal expenses and take care of any damages. When structuring your policy, it's important to include enough liability to take care of all of your assets, including savings accounts, vehicles, houses, investments, etc. If you don't have sufficient liability protection, one lawsuit could take everything you have. Some consumers choose to supplement their plan with an umbrella liability policy for added peace of mind.
Basic plans also include loss of use coverage, which pays for the additional living expenses you incur after your dwelling is damaged by a covered event. This might include the cost of meals, housing, and storage for your possessions. Generally, loss of use is limited to 20% of your dwelling coverage. Most Texas homeowners insurance policies also offer medical payments coverage. This pays for the injuries other people sustain on your land. In some cases, it may also apply to injuries you cause away from your property. Usually, this applies regardless of fault. Remember that medical payments protection only pays for the medical expenses of people who are not in your household, so it is not a substitute for medical insurance.