Home insurance is usually called hazard or homeowners insurance. It is a property insurance that provides for assistance when a private home is damaged. Included in the policy may be replacement of contents, and liability coverage should someone be injured while at the home.

Homeowner’s insurance can also provide coverage for loss of use of the home, in the event of a fire, etc. The policy must be updated periodically to the current market value of the home for it to remain valid. Sometimes the insurance company will require that the home be appraised to determine the current market value, especially when there is a steep decline or upsweep in home values. A policy is available to cover owners of older homes, allowing a lower valuation of the property due to a high replacement cost.

Some events are not covered under the basic policy. These are usually damages due to flood, earthquakes, other acts of God and war. Riders (an additional coverage) can be added to the basic policy for an additional premium to cover these events. Home insurance typically is purchased year by year. When the homeowner has a mortgage, the lending institution usually requires that the property be covered by a home insurance policy to protect their investment. A copy of the policy listing them as an interested party is furnished each year. In some states it is possible to purchase a perpetual coverage policy.

Homeowner’s insurance has been standardized for the last 35 years. Prior to that a separate policy for each risk; fire, theft, liability, etc. had to be purchased.

Standard policies are written to cover common insurance needs. They range from a limited policy to cover a valuable item in the home, such as an art object, to a named perils policy listing events that would be covered. Then there is the all risk basic policy that covers all but those events specifically excluded (such as floods).

People who rent instead of owning can also obtain a home insurance policy that covers their household possessions and certain liabilities resulting in injury to others while in the premises. This is separate from the blanket insurance that covers the building they are renting in. There is a special home insurance policy offered for condominium dwellers that includes some liability plus fills the gap between the blanket property coverage and their needs. It typically covers loss due to lightning, falls on ice and snow, theft, riots, vandalism, hail and wind damage. The liability usually covers guests as well as residents. A check of the association by-laws will point out areas that the resident will need to cover with their own home insurance.

Rates (premium payments) vary according to the components of the policy and the value set for replacement. In addition, factors that help lower the rate are such things as location in an approved fire district, proximity to fire hydrants or fire stations, and not being in a high crime area.