A standard homeowners policy (also known as an HO-3 policy) generally protects your home and your personal property from damage caused by:
Here's an overview of the options typically available on a base-level homeowners insurance policy.
What it does: Protects you from financial loss if your home and any connected structures (garage, deck) are damaged from disasters like wind, hail, explosions, and vehicles.
Coverage offered: The amount of coverage you purchase is up to you, but typically you'll want enough to rebuild your home should something catastrophic happen.
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Other structures protection
What it does: Insures the unattached structures on your property (carport, tool shed, fence).
Coverage offered: The default limit is 10 percent of your dwelling protection. However, you can change this limit so it covers the full replacement cost of your structures.
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Additional living expense coverage
What it does: Helps pay to relocate you if you have to leave your home temporarily due to a covered loss. It also pays additional costs so you can maintain your standard of living while away. In most states you'll be covered for up to 12 months, but in certain states the coverage will last up to 24 months.
Coverage offered: The default limit is 10 percent of your dwelling protection. You can increase or decrease as you see fit, but keep in mind that if your home's value is on the low end, 10 percent of your dwelling protection may cover only a few months of living expenses.
More on additional living expense coverage >
Water backup coverage
What it does: Different from flood insurance (which is not included in a standard policy), water backup coverage helps repair damage from water that comes from the ground up, such as an overflowing drain or broken sump pump.
Coverage offered: Varies by state and can range anywhere from $5,000 to $25,000.
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Personal property insurance
What it does: Covers your belongings, either inside the home or on the go.
Coverage offered: The default limit is 60 percent of your dwelling protection, but you can adjust this to as high as 75 percent or as low as 40 percent. It's wise to make a detailed home inventory and set your limit based on what it would cost to replace all your stuff.
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Family liability protection
What it does: Helps cover your legal liability if your negligence causes others' injuries or property damage. It also helps pay your own legal defense.
Coverage offered: The default limit is $100,000. 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.
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Guest medical protection
Fire department charges coverage
What it does: Helps cover the fee your fire department may charge to respond to a call.
Coverage offered: Up to $5,500.