Whether you are in the market to buy a new home or to sell your home, you probably have some type of homeowner’s insurance policy. Even if you want to take a mortgage on your house, you need it. A lot of people think of homeowners’ insurance as something of a burden. Pay a fixed amount of money each and every month in case of something that might damage your home.
We keep on thinking on those lines until something does happen. When tragedy strikes and there is no one to turn to, it’s our homeowner’s insurance that helps us rebuild our dream home and carry on with our lives. That is why hazard insurance is such an essential part of the homeowner’s insurance. It takes care of the structural damage that our house receives due to severe conditions and ensures that we don’t need additional finances to take care of our houses.
Your homeowner’s insurance policy covers any and all structural damages that happen to your house in any tragic and destructive events. It also takes care of the personal items that are present in your house. Homeowner policies are package deals. They don’t cover your home and your belongings, but also your legal responsibility to others if others have been hurt or harmed due to that event. This includes others’ properties as well. If the disaster is so bad that you can’t live in your own home, then your homeowner’s insurance policy also covers the cost of living that you will incur when you live in some other location while your house is being rebuilt.
For most people, hazard insurance is a very confusing topic. If homeowner’s insurance takes care of structural damage, why would anyone need additional hazard insurance?
The difference is that homeowner’s insurance protects you against thefts and any damage that might have been caused to your home and your belongings due to normal ways. Hazard insurance is the policy that takes care of the structural damage that is caused by natural disasters.
Both the policies have the same goal: to make sure that your house and its belongings are covered in case of any incident or event whether it is caused due flooding in the kitchen or a hurricane that damages your walls or a fire.
The difference is that while homeowner’s insurance covers your belongings as well, hazard insurance covers only the structure of your house.
Some of the common types of incidents that cause damage to your house and are covered by the hazard insurance are:
So, just to summarize what we know so far about hazard insurance, if your house is damaged due to a hurricane, a flood, or a tornado, hazard insurance will pay the cost of rebuilding your home and any repairs that are needed. But if the fire burned away all your clothes in your closet, then hazard insurance will not pay for your clothes or any other item that were stored in the closet. For that, you have homeowner’s insurance.