Frequently Asked Questions About Home Insurance
Q: Is homeowners insurance required by law?
No. Unlike auto insurance, homeowners insurance is not legally required. However, if you have a mortgage, your lender will almost certainly require you to carry homeowners insurance to protect their investment. Even without a mortgage, going without coverage is a significant financial risk.
Q: What's the difference between homeowners and renters insurance?
Homeowners insurance covers the structure of your home plus your belongings, liability, and additional living expenses. Renters insurance covers only your personal property, liability, and additional living expenses — the landlord's policy covers the building itself. Renters insurance is significantly cheaper, typically $15–$30 per month.
Q: Does homeowners insurance cover my roof?
Yes, but with caveats. Most policies cover roof damage caused by sudden, accidental events (windstorm, hail, fire, fallen tree). However, they won't cover damage from age-related wear and tear, lack of maintenance, or a roof that was already in poor condition. Some insurers limit roof coverage for older roofs or only pay actual cash value (depreciated value) instead of replacement cost.
Q: How do I file a homeowners insurance claim?
- Document the damage — take photos and videos immediately.
- Prevent further damage — make temporary repairs (tarping a leaky roof, boarding up broken windows). Save receipts.
- Contact your insurer — file the claim as soon as possible.
- Meet with the adjuster — the insurance company will send an adjuster to assess the damage.
- Get repair estimates — obtain independent estimates to compare with the adjuster's assessment.
- Review the settlement — make sure the payout covers your losses before accepting.
Q: Will filing a claim raise my premiums?
Possibly. A single claim may not significantly impact your rates, but multiple claims within a short period likely will. Claims are also recorded in the CLUE (Comprehensive Loss Underwriting Exchange) database, which other insurers can access. For very small claims close to your deductible, it may be better to pay out of pocket.
Q: What is an umbrella policy, and do I need one?
An umbrella policy provides additional liability coverage beyond what your homeowners and auto policies offer. It kicks in when you exhaust the liability limits on your underlying policies. If you have significant assets (home equity, savings, investments) that could be targeted in a lawsuit, an umbrella policy is an affordable way to protect them. A $1M umbrella policy typically costs $150–$300 per year.
Q: Does working from home affect my homeowners insurance?
It can. Standard homeowners policies have limited coverage for business equipment and zero coverage for business liability. If you run a business from home or store significant business equipment, you may need a home business endorsement or a separate business policy.