MA Homeowner Insurance 101 – Coverage Basics

Homeowner Insurance is asset protection designed to bring your home and possessions back to the same condition prior to loss. Lenders require proof of home insurance, also known as Hazard Insurance of Fire Insurance, in the form of an insurance binder. Often they require a “paid in full” receipt and that the home is insured for 100% of estimated Replacement Cost.

Johnson & Rohan Insurance will help you determine the Replacement Cost of your home. Replacement Cost represents the amount it would cost to rebuild your home if you were to suffer a total loss. Not to be confused with market value, Replacement Cost is pure construction cost. Replacement Cost is determined by such things as: age, condition, square footage, updates, building quality and town multipliers.

Massachusetts Home Insurance Coverage Review

Once Replacement Cost is estimated, your MA home insurance agent is ready to start quoting. The standard MA home policy is a package consisting of:

Coverage A, Dwelling – The amount of coverage assigned to your dwelling should reflect the amount it would cost to completely repair or rebuild your home should it suffer a covered loss.

Coverage B, Other Structures – Typically 10% of Coverage A, Other Structures Coverage is for other structures (mailbox, shed, dog house, swimming pool, garage etc.) on your property detached from your dwelling.

Coverage C, Personal Property – Typically 50 – 70% of Coverage A, Personal Property Coverage provides coverage for your personal possessions such as furniture, clothing and appliances are covered. Certain types of possessions, such as jewelry, fine arts, antiques & collectibles, are excluded or have limited coverage.

Coverage D, Loss of Use – Typically 20% of Coverage A, Loss of Use Coverage pays for housing and other living expenses (like meals and laundry) if you suffer a loss that makes your home uninhabitable.

Coverage E, Personal Liability – Personal Liability Coverage provides on & off premise lawsuit protection and will provide coverage for bodily injury or property damage for which you are legally responsible.

Coverage F, Medical Payments – This coverage is available to others (not household residents) and will pay medical expenses up to, traditionally, $1,000.

Covered Perils – A homeowner insurance policy will provide protection from: fire or lightning, windstorm or hail, explosion, aircraft, vehicles, riot or civil commotion, smoke, theft, vandalism/malicious mischief, glass breakage, volcanic eruption, falling objects, weight of ice, snow or sleet, freezing of plumbing, accidental plumbing discharge, rupture of steam or hot water heating system, air conditioning systems, or water heaters, damage from artificially generated electricity.

Exclusions – A homeowners policy excludes coverage from: flood, or water that backs up through sewers, loss to building by earthquake, aftershocks and mud slides, loss by enforcement law or ordinance regulating construction, repair or demolition, or zoning, loss due to power interruption when the interruption takes place off the residence property, loss due to neglect of the insured to save and preserve property following a loss, war and nuclear perils, intentional loss.

Deductibles – Homeowner policy include a deductible. The deductible is the amount the consumer is responsible for before the insurance coverage applies. Typical deductibles are $500, $1,000, and $2,500. The higher the deductible: the lower the annual premium.

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