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how home insurance works: breaking down your coverage
Generally speaking, the main function of home insurance is to protect you from financial loss after a covered incident. Home insurance is typically used to safeguard the following:
- Your home's structure and other structures on your property
- Your personal belongings
- Your liability for others' injuries sustained on your property or that you're otherwise responsible for
But within this framework, you have a ton of choices. For instance, did you know you can tailor contents insurance based on category (like "sports equipment" or "jewellery")? Or that there's home insurance coverage specifically designed for protecting your garden, or even for retrieving lost computer data? And that's just for starters.
what does home insurance protect against?
A standard homeowners policy generally protects your home and your personal property from damage caused by:
- Fires or lightning
- Windstorms (including hurricanes and tornadoes) or hail
- Riots or civil commotions
- Theft or vandalism (sometimes called malicious mischief)
- Falling objects
- Weight of ice, snow, or sleet
- Freezing of plumbing, heating, air conditioning, or other household systems
A standard home policy won't typically cover damage caused by floods or earthquakes. Other exclusions could include mould or fungus, vermin, and normal wear and tear.
home insurance coverage: the basics
The following homeowners insurance coverage types are typically included automatically on Esurance policies.
If your home or any structures connected to it (like a garage or deck) are damaged by disasters like wind, hail, explosions, or vehicles, dwelling protection guards you against financial loss. The amount of coverage you choose is up to you, but we recommend getting enough to rebuild your home if necessary.
Keep in mind, if you decide to add guaranteed home replacement cost coverage, you won't need to select a limit for dwelling protection.
Other structures protection
If your property has structures that aren't attached to your home (like a carport, tool shed, or fence, for example), your policy will cover those, too. We'll automatically cover 10 percent of your dwelling protection, but you can change this limit so it covers the full replacement cost of your structures.
As with dwelling protection, if you add guaranteed home replacement cost coverage, you won't need to select a limit for other structures protection.
Personal property insurance
Whether at home or on the go, you can rest assured that your personal belongings are covered. You can select any coverage amount between 40 and 75 percent of your dwelling protection, just to help replace your stuff.
Additional living expense coverage
If you have a covered loss and need to relocate temporarily, this coverage kicks in. It also pays the cost of maintaining your standard of living while you're in a temporary residence (up to 20 percent of your dwelling protection).
Family liability protection
If you (or a family member who lives with you) are legally liable for others' injuries or property damage, this coverage can pay for liability and legal defence costs. The default limit is $1,000,000, but it's usually smart to get as much coverage as your assets are worth so your savings, property, and possessions aren't at risk in a lawsuit.
Voluntary medical protection
If someone's injured on your property, voluntary medical protection will cover up to $5,000 in medical bills.
Guaranteed home replacement cost
If the unthinkable happens and your home is destroyed, you'll need enough money to rebuild. Guaranteed home replacement ensures you have the necessary funds to rebuild your home to its original condition, regardless of how much dwelling protection coverage you have. So if your rebuild costs more than you expect, you're covered.
home insurance coverage: additional protection
The following supplementary coverages on your policy can help provide even more peace of mind.
Sewer backup coverage
You never want to worry about sewer water infiltrating your home, but if it does happen, this coverage will make sure it doesn't break the bank. Note, however, that it doesn't cover floods, only water or sewage coming from backed-up drains or the sewer.
Roof surfaces protection
Windstorms and hail can really take a toll on your roof. Luckily, Esurance offers 2 options to help you stay covered.
If you choose roof surfaces extended coverage, we'll take care of the full replacement cost of your roof (up to your limit, of course). Or, with the basic roof surfaces coverage, we'll cover a percentage of your roof's replacement cost, based on its age and material.
If you have an older roof, the basic roof surfaces coverage is a great, affordable option. But if your roof is new or was replaced recently, the extended coverage option could be your best bet.
Identity theft and legal expense coverage
For just $3 a month, this coverage will help fix the damage done to your name and credit if someone steals your identity It covers reasonable expenses you might incur in the process of restoring your credit. (Think new loan application fees, attorney fees, lost wages from time off work.) You'll even have access to telephone legal assistance to help you repair your good name.
Eco upgrade coverage
Do you have older, less energy-efficient appliances in your home? With eco upgrade coverage, you get the replacement cost, plus an extra 20 percent for each item you replace with ENERGY-STAR® qualified products (after a covered loss).
Oil tank liability protection
A leaky heating oil tank is bad for the environment, and bad for your chequebook. If your tank develops a leak (and you're responsible for cleanup), oil tank liability protection will have your back. This coverage is automatically included as part of your family liability coverage if you have an oil tank.
Solar energy system coverage
Going green is a big investment. Once you've made the leap to solar, you should enjoy the energy savings without worrying about damage to your panels. If you have a solar energy system, this coverage will automatically be applied to your policy to help you cover the cost of repairs should they be damaged.
Building ordinance coverage
Local building ordinances and bylaws change often, and it can be expensive to retrofit your home to current standards. With this coverage, you'll get an extra layer of protection — especially useful if you live in an older home or one that hasn't been renovated in years.
Without this coverage, your policy would restore your home to its original condition, but it wouldn't cover the extra cost of bringing it up to new standards.
Business pursuits coverage
If you keep work equipment like books, electronics, and tools in your home, add business property coverage to get up to $5,000 in extra protection. And if you travel for work, these items will even be covered up to $1,000 while you're on the road.
Plus, if you keep samples or goods for sale in your home, this coverage will protect them up to $2,000 while they're on your premises.
Golf equipment coverage
Don't let damage or theft take you off the course. Choose this option to increase your golf cart coverage to $2,500, and bump the limit for your clubs up to $3,000. Higher limits may be available for even more protection.
Sports equipment coverage
The cost of sporting goods can really add up over the years. This coverage will help you replace your non-golf-related sports gear if it's damaged beyond normal wear and tear. It'll cover up to $20,000 per occurrence or $3,000 per item, so you can get back to your routine as soon as possible. Higher limits may be available.
Yard and garden coverage
If your yard is damaged in a storm or other covered event, yard and garden coverage will help you with the cost of removing damaged trees, shrubs, and other plants (up to 10 percent of your dwelling protection or $1,000 per plant). Plus, your snow removal equipment and riding mower are also covered up to $10,000.
Electronic data recovery expense coverage
If a virus or crash destroys data stored on your computer, tablet, etc., we'll pay a data recovery firm to restore your hard drive. Your policy includes up to $2,500 in protection, but you can choose up to $7,500 if you'd like more coverage.
Jewellery, watches, and furs coverage
Your homeowners policy is designed to protect your valuables. However, it limits the amount of coverage for jewellery, watches, and furs to $5,000 per occurrence and $2,000 per item.
With this option, you can get up to $20,000 per incident and $3,000 per item to replace your jewellery, watches, and furs after a covered event. Or contact us to discuss adding even more protection.
Personal article floater coverage
It sounds complicated, but it's really just a fancy way of saying that if you have expensive individual items (such as jewellery, artwork, heirlooms, etc.) that aren’t adequately covered by your basic homeowners policy, you can add supplemental coverage for them.