Having a homeowner’s insurance policy in place is an essential part of protecting yourself from disasters such as floods, fires, and even burglaries. However, policies aren’t all created equal and simply having one doesn’t mean you have the coverage you expect. It’s important to ensure that your policy gives you all the cover you want and need.

We’ll discuss some of the key aspects of your policy you’ll want to consider and be aware of as well as how you can find out what exactly is covered by your specific policy.

Coverage Types

The types of coverage included can vary significantly and knowing which are included in your policy is essential to knowing what you’re able to claim for. You should also be aware that different types of coverage within the same policy have their own coverage limits.

Some of the key types are as follows:

Dwelling

This is the core of a homeowner’s insurance policy and covers damage to your home itself, paying for repairs or, in extreme circumstances, for part or all of your home to be rebuilt.

Personal Property

This covers the items inside your home in the event of them being stolen or damaged in a covered event. In certain policies, this can also provide some cover for possessions stored in other specified locations.

Other Structures

This covers structures on your property other than your home itself, including sheds and barns, but also features such as fences.

Liability

This protects you if someone else is injured or their possessions are damaged while at your property and you are considered financially liable.

Other Types of Coverage

There are other types of coverage that protect you in various circumstances. This can include covering medical expenses for injuries sustained on your property even when you aren’t financially liable and helping to pay for expenses such as hotels if a covered event prevents you from staying in your home.

Exclusions

Just because your property or possessions are covered by your policy, doesn’t mean that it will pay out in all cases. Insurance policies also list exclusions, which are situations and events you aren’t covered for and so won’t be able to make a claim.

The vast majority of insurance policies have exclusions for things such as wear and tear, damage caused by pets, and certain other issues. However, like other factors, exclusions can vary between policies and it’s important to be aware of what you are and aren’t covered for.

Replacement Cost Value and Actual Cash Value

As well as knowing what is and isn’t covered by your policy, you’ll also want to know how much coverage is offered. As well as your limits, the amount you can claim is determined by whether your policy pays based on replacement cost value (RCV) or actual cash value (ACV).

With replacement cost value policies, you’ll receive the full cost to replace whatever is lost at the time you make your claim. Actual cash value policies take depreciation into account and pay out based on the estimated value of your property when you claim. Some policies may include certain types of cover on a replacement cost basis and others on an actual cash value basis.

Understanding Your Cover

The simplest way to verify exactly what cover you have is by checking your policy. The policy will include a declarations page, which provides a summary of your cover, and a policy form, also known as a policy jacket, which provides additional details such as what exclusions apply.

If you’re unsure about what exactly is and isn’t covered or have questions about specific situations, your best option is to contact your provider or speak to an independent advisor.

Considering the Alternatives

If, after examining your policy and the coverage it offers, you feel that it’s lacking or that you would benefit from additional coverage, you have two options. The first is to contact your current provider and discuss whether they’re able to offer the coverage you need. The second is to seek out another provider who offers more comprehensive coverage and switch to a policy with them.

Either way, it’s always best to be proactive and make sure that you have all the cover you need.