Understanding Key Home Insurance Terms

Home insurance is one of the most common types of coverage among U.S. residents, potentially providing robust financial protection for homeowners and their property. However, while these policies may be common, their complexity should not be underestimated. Many nuanced and even confusing components of home insurance could prove problematic should a homeowner fail to understand their coverage fully. With that, the team at Tom Reyes Insurance Agency is proud to offer this guidance on key home insurance terms.

5 Key Home Insurance Terms

Whether assessing your insurance needs for a new home or revisiting coverage approaching renewal, you should ensure that you fully grasp the following parts of potential policy:

• Deductible—This establishes a minimum amount you are typically required to pay out of pocket for covered incidents. After reaching your deductible, your home insurance can begin contributing toward outstanding losses.
• Premium—This term refers to the regular (e.g., monthly or annual) payments you make to maintain your home insurance policy and retain coverage. Many factors, including your location, property details, coverage selections and claims history may impact premiums.
• Exclusions—These perils and incidents may not be covered until your homeowners insurance. Floods, earthquakes and windstorms may often be excluded, making it necessary to acquire additional coverage.
• Endorsements—This term refers to enhancements or adjustments you may be able to use to augment and customize your homeowners insurance policy. Endorsements may be used to fill coverage gaps, such as those left behind by the aforementioned exclusions.
• Limits—The coverage limits of your homeowners insurance establish a maximum amount of financial aid that your policy can pay out. As such, should your losses exceed these limits, you would need to cover outstanding costs yourself.

We’re Here to Help

Contact Tom Reyes Insurance Agency today to learn more about homeowners insurance or to compare personalized quotes.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.