Reading Your Home Insurance Statement: How To Find Certain Pieces Of Information

Home insurance is similar to car insurance in that it is a requirement for the length of time that you have a loan on the property or asset. Once you own the house or property in full and there is no longer a mortgage or lien on it, you can forego the insurance. However, it is not recommended that you do away with your insurance because it protects your home against all of the things that could possibly go wrong with it. As long as you have the insurance, you may acquaint yourself with the information on your policy and where you can find certain key pieces of information.

The Declarations Page

This is the page that lists all of the types of coverage you have and the amounts of coverage you have. Coverage may be listed as "coverage A, B, C, D, etc.," followed by a brief description of just what that coverage is. In most cases the "coverage A or coverage 1 refers directly to your home. The number directly across from this is how much the insurance company has listed your home to be valued at and replaced for in the event that your home is a complete loss and you need to rebuild. Other types of coverage following your home often include:

• Other structures or outlying buildings
• Personal property
• Loss of use not covered by "dwelling coverage"
• Personal liability, which protects you and your property in the event that someone is injured on your property or in your home and decides to sue
• Medical payments to others
• Flood insurance 
• Hurricane insurance (if you live along the Eastern seaboard or Southern coast/Gulf of Mexico where it is highly likely your home will be destroyed by a hurricane)

If some or all of these types of coverage are listed on your insurance declarations page, they will be immediately followed by a dollar amount. The dollar amount reflects what you might be entitled to, or what others may be entitled to, in the event that something devastating befalls your home, property or guests on your property.

Premiums and Deductibles

There should also be a page or separate column that lists your premiums, charges, surcharges and deductible. The premiums are what you pay for the types of coverage listed, and these can sometimes be found in a column adjacent to the column that lists the types of coverage and amounts. Your charges are the amounts the insurance company charges you for each type of coverage separately, in case you would like to drop a type of coverage. Surcharges are what the insurance company deems that you should pay due to extenuating circumstances or annual increases in coverage costs. Finally, your deductible should be clearly listed as the deductible, and what that amount is, whether or not it is universal for all of the types of coverage you have, and/or any additional deductibles that apply for specific circumstances.