Property insurance provides protection against most risks to property, such as fire, theft and some weather damage. This includes specialized forms of insurance such as fire insurance, flood insurance, earthquake insurance, home insurance, or boiler insurance. Property is insured in two main ways—open perils and named perils.
Open perils cover all the causes of loss not specifically excluded in the policy. Common exclusions on open peril policies include damage resulting from earthquakes, floods, nuclear incidents, acts of terrorism, and war. Named perils require the actual cause of loss to be listed in the policy for insurance to be provided. The more common named perils include such damage-causing events as fire, lightning, explosion, and theft.
1. Auto insurance
Auto insurance protects you from paying the full cost for vehicle repairs and medical expenses due to a collision. Some factors that affect the premiums you pay for this protection, include your :
- Gender
- Age
- Marital status
- Credit history
- Car's make and model
- City and neighborhood
- Types of Auto Insurance
Every state requires drivers to have auto insurance. If you don't have insurance, you must have financial responsibility waivers. These waivers ensure that you can pay for property damages or medical expenses. There are several components that can make up your insurance policy:
- Liability coverage protects you if you are at fault for a collision. It pays for medical expenses and vehicle damage for the other driver and passengers.
- Uninsured motorist coverage pays for damages to your car and medical expenses if an uninsured driver hits your car.
- Collision coverage pays to repair your vehicle, if you were at fault for the damage.
- Underinsured motorist coverage pays damages for your car if someone hits it, but their insurance can't pay for your car damages.
- Comprehensive coverage pays for damage to your car due to theft, fire, or falling objects.
Be sure to read the declarations page of your auto insurance policy. This page is a summary of your policy. It includes:
- The length of coverage
- Annual premium
- The largest amount your insurance company will pay out for each type of claim, and
- How your premium payment applies to each part of your coverage
2. Homeowners and Renters Insurance:
Homeowners insurance protects your home and personal property against damage or loss. It insures you in case someone gets hurt while on your property. You may already have insurance on your home if you have a mortgage on the property.
Renters insurance offers renters coverage like homeowners insurance.
Homeowners or renters insurance may pay claims for:
- Damage to your home, garage, and other outbuildings
- Loss of furniture and other personal property due to damage or theft, both at home and away
- Extra living expenses, if you live in temporary housing during home repairs
Homeowners or renters insurance may also pay for:
- Physical injury and property damage that you cause to others through negligence
- Accidents happening in and around your home, as well as away from home, for which you are responsible
- Injuries occurring in and around your home to anyone other than you or your family
- Limited coverage for money, gold, jewelry, and stamp and coin collections
- Personal property in storage
3. Flood Insurance:
Homeowners and renters insurance do not usually cover flood damage. The National Flood Insurance Program (NFIP) helps reduce the impact of flooding. Renters, property owners, and businesses are eligible for NFIP. Even if you live in an area that is not at high risk of flooding, you may still be required to have flood insurance.
How to apply?
- See if your community participates in the program. Check the Community Status Book to see if your county or city participates in the National Flood Program (PDF, Download Adobe Reader). You can only buy a flood insurance policy if you’re a renter, homeowner, or business owner. Also, your property must be in an NFIP participating community.
- Contact an insurance agent in your area. You can only buy flood insurance through an insurance agent. You cannot buy it directly from the federal government. If your local insurance agent is unfamiliar with the NFIP, find an agent serving your area. Call the NFIP Help Center at 1-800-427-4661.
What flood insurance can cover?
- There are two types of flood insurance coverage: building property and personal property. Flood insurance only covers physical damage to your building or personal property directly caused by a flood. The NFIP advises that you buy both types of coverage.
- Rates are set nationally and do not differ from company to company or agent to agent. These rates depend on many factors, such as the date and type of construction of your home and your building's level of risk.
- Typically, there's a 30-day waiting period from the date of purchase before your policy goes into effect.
- All National Flood Insurance policies include a surcharge that Congress mandates. If your community participates in the Community Rating System (PDF, Download Adobe Reader), you may qualify for an insurance premium discount. This discount is calculated using a system of credit points earned as a result of flood preparations and improvements
- Contact your flood insurance agent to make changes to, pay for, or renew your policy. If your mortgage lender requires you to have flood insurance, ask them questions about renewing or changing your policy.
- Learn how to prepare for and recover from disasters and emergencies.
