The homeowners insurance coverage that the average consumer buys is widely misunderstood. The policy benefits and features are actually quite comprehensive but many people assume that they cover deterioration and maintenance problems. This is not the case. Those kinds of home maintenance problems were never designed to be covered by a homeowner policy. The rates would quadruple if that were the case. Homeowners insurance is unique and broad. Property insurance insures against perils. Perils are unforeseen occurrences like fire or lightening. Understanding perils is the first step in understanding your homeowners insurance.

Basic Named Perils

Fire or Lightning
Windstorm or Hail
Explosion
Riot or Civil Commotion
Aircraft
Vehicles
Smoke
Vandalism & Malicious Mischief
Theft
Falling Objects
Weight of Ice Sleet and Snow

There are more perils than those listed above but you can see how these perils are clearly unforeseen and are not at all related to deterioration or construction problems. Understanding perils will help you understand the concept of insurance. The next part of the homeowners policy that would be worth examining is the definitions.

Definitions

Insured is the named insured and all of the resident relatives
Insured Location the resident premises listed on the declarations page including the land where there is a home under construction. (Business use is excluded)
Occurrence is an accident or unforeseen event which includes the continuous or repeated exposure from the same harmful event.

These are three of the basic definitions that you will find in most homeowners policies. The definition of occurrence is much broader than most people understand and so it is good to read some of the definitions. These are some of the fundamental benefits and features of homeowners insurance coverage that most people do not take the time to examine. As long as you own a home you will most likely always have a homeowners policy and so it would be wise to get the basics out of the way. Too often we talk price instead of coverage. Go online and do some research about homeowners insurance and that will make your next home insurance purchase that much easier.