Know Your Coverages
The coverages on your homeowners insurance policy may seem like alphabet soup: A, B, C, D, E…. What are the coverages, and why are they important? Here’s a quick summary.
27 June 2013
Coverage A: Anything involving the physical structure of your home, generally termed “dwelling.”
Coverage B: Other structures that are not directly attached to your home, such as a separate garage, shed, or fence.
Coverage C: In a word, the “contents” of your home. If you flipped your house upside down, everything that fell would be contents. It is all the items that are not attached, or built-in, to your home.
Coverage D: If you have to live elsewhere temporarily due to covered damage to your home, you will need this coverage for your additional living expenses.
Check with your insurance agent to be sure that you have adequate coverage, and that your policy has been updated to include recent home improvements or high-value items. Your agent has access to Replacement Cost Estimate (RCE) software that can help in estimating whether or not your current Coverage A amount is adequate.
A complete home inventory will help you find out if your contents (Coverage C) amount is adequate, or if you need to purchase additional coverage for some items. Here are some examples: your new diamond anniversary ring; great-grandma’s antique silver service and china set; the mini music recording studio in your garage; or the coin collection you recently inherited from your great-uncle. After you finish your home inventory, or if you have questions during the process, check with your insurance agent to be sure that your policy includes the coverage you need.
“Other structures,” Coverage B, is often the most confusing. Most commonly, other structures are defined as those which are “set apart from the dwelling by a clear space.” Example: A fence that is not attached to the dwelling is generally included under Coverage B (Other Structures), but if the fence is attached to your house, it is considered part of Coverage A (Dwelling). Is your garage separated from your house, or attached? Is your workshop a stand-alone building in your backyard, or part of the garage attached to your house?
If you spent all spring building a new gazebo in the middle of your back yard or redecorating your stand-alone pool cabana, check with your insurance agent to find out if you are covered. The cost of other structures, such as pool decks and screen enclosures, can add up quickly, so you want to be sure they are included under the Coverage B portion of your policy. You may also want to ask you agent about adding an Emerald Endorsement to your Tower Hill policy, or a Personal Articles Floater (PAF) for high-value items.