Homeowners insurance covers four key components: the main dwelling, other structures, personal property, and loss of use.

• Coverage A: Main dwelling: Coverage of the main dwelling protects the home and any attachments to the home. It does not cover any damage to the land.
• Coverage B: Other structures: Coverage of other structures protects buildings on the property that are not attached to the main dwelling, as well as landscaping; however, it does not protect land or structures used for business purposes. Coverage of other structures is limited to 10 percent of the value of the home’s coverage.
• Coverage C: Personal property: Personal property coverage pays (up to policy limits) for all personal property that is owned or used by the policyholder. It covers personal property regardless of the property’s location. For example, loss to contents in your personal vehicle at work would be covered by the personal property component of your homeowners insurance. Personal property coverage also covers property of guests in your home. It is limited to 50 percent of the home’s coverage. For example, if your home is covered for $250,000, you can have up to $125,000 coverage for personal property over and above the $250,000 for your home. In addition, there is a $200 limit on cash, gold, and silver; a $1,000 limit on securities, tickets, and stamps; and a $2,500 limit on silverware. Note that birds, fish, and other animals are not considered personal property.
• Coverage D: Loss of use: Loss of use coverage pays for losses that are incurred if your home becomes uninhabitable. It is limited to 20 percent of the home’s coverage. Benefits of this type of coverage cover living expenses that are incurred if you need to relocate temporarily until your home is repaired. This type of coverage also covers fair rental value of any structure in which a renter was leasing part of the home. Finally, this type of coverage covers losses in the case that a civil authority prohibits you from using the structure.

If you need additional coverage, a homeowners policy can be supplemented in a number of ways through endorsements or additions to your policy. Examples of endorsements include inflation, floaters, and specific risk coverage. An inflation endorsement allows insurance protection to increase parallel to the increase of repair and rebuilding costs. A floater policy endorsement insures valuable personal property for an amount that is higher than your existing homeowners policy limits. Flood insurance, earthquake insurance, and terrorism insurance provide protection in case of specific types of loss as well.