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What is included in a standard homeowner’s insurance policy?



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Insurance policies are made for the widest market workable. To maintain premiums affordable, most people are only required to get coverage by a standard homeowner’s insurance policy. For example, the standard policy doesn’t contain coverage for a home business, because most people do not have a business from their home.


So to include that type of coverage in the standard policy, it would increase premiums even for someone who doesn’t own a home business. An endorsement must be written for any modification that adds or deletes one or more changes of a general policy to serve unique needs.


There are more than one hundred different endorsements for the standard homeowner's policy. A basic homeowner’s policy protects your home and personal belongings from 11 different hazards. This coverage includes security against fire, theft, lightning, and all other uncontrolled accidents.


Now, many agents will not even show this policy, because it simply does not cover your home the way you need it. Many states have legislated against selling this type of policy, because the coverage is not worth the cost. It is recommended for most people to get the broad or special homeowner’s insurance.

A broad homeowner’s policy protects you from 17 different hazards including your home structure and your personal belongings from the 11 hazards covered from the basic policy. The extra coverage includes water damage, falling objects, electrical surge damage, and heating system damage. The broad homeowner’s policy premium will cost about 5 to 10 percent more than a basic homeowner’s policy.


A Special homeowner’s insurance policy makes sense for most people, because it will give you the most coverage for the smallest cost. It is favoured over the basic homeowner’s policy, because it includes much more coverage. The special homeowner’s policy protects you from all hazards except those specifically not included by name in the policy.


However, floods, earthquakes, and damage caused by nuclear accidents and war are almost always not included. A special homeowner’s policy typically runs about 15 to 20 percent more than a basic homeowner’s policy and 10 to 15 percent more than a broad homeowner’s policy.


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