Fountain FinancesSmarter money decisions

Home Insurance

Protect your home, belongings and savings from major losses.

By Fountain Finances Editorial TeamUpdated

What a standard policy covers

A typical homeowners policy includes:

  • Dwelling: the structure of your home.
  • Other structures: fences, detached garages, sheds.
  • Personal property: furniture, electronics, clothing.
  • Loss of use: extra living expenses if you must live elsewhere during repairs.
  • Personal liability: injuries to others or damage you cause, including legal costs.
  • Medical payments: minor injuries to guests regardless of fault.

Replacement cost vs. actual cash value

Replacement cost coverage pays to replace damaged items with new equivalents. Actual cash value subtracts depreciation, so you receive less. Replacement cost policies cost more but pay out much more after a loss.

Common exclusions

Floods, earthquakes, routine wear and tear, pest damage and neglected maintenance are commonly excluded. Flood coverage is available through the National Flood Insurance Program and private insurers; earthquake coverage may be purchased separately in many areas.

Saving on home insurance

Compare quotes annually, bundle with auto insurance, raise your deductible if your savings allow, install protective devices, and ask about discounts for a new roof or claims-free history. Your premium is often paid through your mortgage escrow account — see how mortgage payments work.

Frequently asked questions

Does homeowners insurance cover floods?

Standard homeowners policies generally exclude flood damage. Flood insurance is available through the National Flood Insurance Program (NFIP) and some private insurers, and may be required by your lender in high-risk flood zones.

How much homeowners insurance do I need?

Dwelling coverage should be enough to rebuild your home at current construction costs — which can differ from its market value. Add enough personal property and liability coverage to protect your belongings and assets.

Is homeowners insurance required?

No law requires it, but mortgage lenders almost always require it as a condition of the loan.

Part of our Insurance hub and our complete personal finance guide. Read our editorial standards.

Home Insurance guides

All guides →