Understanding Your Greensboro Home Insurance Policy

Understanding your Greensboro home insurance policy can be tedious, since it's a legal document with lots of big words and plenty of small print. The basics, however, should be easy enough to understand, especially if you ask your agent to walk you through it. The fact is, many or most policyholders don't take the time to read through their entire homeowners policies, but it can't hurt to know what you've got, especially if you have occasion to file a claim.

What Most Policies Cover

A typical Greensboro home insurance policy provides three forms of protection:

• Protection from financial loss due to the damage or destruction of your home from any of the stated perils in the policy
• Protection from financial loss due to the damage or destruction of the personal possessions in your house and on your property
• Protection from financial loss due to being found liable for someone being injured while on your property. This liability coverage also typically extends to you, your family members and your pets if they cause property damage or injury to someone while away from your home.

Structural Coverage

A typical homeowners insurance policy covers the structure of your home against damage from a stated list of perils such as fire, windstorms, water damage (except flooding), hail, civil disturbances, explosions, theft and vandalism. You can insure the structure one of three ways:

1. Replacement cost – pays for the cost of replacement without subtracting any amount for depreciation. The maximum dollar amount payable will be limited.
2. Extended replacement cost – this coverage allows for paying a certain amount above the previously stated payment limit. Typically this extra allowance is for 20%. This protects against sudden construction cost increases in a certain area where widespread damage has occurred to many homes.
3. Actual cash value – this coverage pays for replacement costs minus an amount factored in for depreciation and wear-and-tear.

Personal Possessions

The personal possessions found inside your home are covered against damage, destruction or other loss such as through theft. Your possessions may be insured for replacement cost, meaning replacement with a similar kind and quality of item without a deduction for depreciation. Actual cash value coverage pays a replacement amount of the damaged or lost item minus depreciation.

There are many other items spelled out in an insurance policy that you should know. Best advice is to get a full explanation from your agent.