What homeowners insurance covers
A standard homeowners policy covers the dwelling (the house itself), other structures such as a fence, your personal property, extra living costs if you must move out during repairs, and personal liability. Read the declarations page for each limit and your deductible. Check whether belongings are covered at replacement cost or actual cash value, and note that flood and earthquake are usually excluded.
Why it matters: The declarations page decides what a bad day costs you, and most owners have never read it.
Steps
- Find the declarations page, the summary at the front of the policy.
- Write down the dwelling limit and ask whether it would rebuild the house at today's costs.
- Note the limits for other structures, personal property and loss of use.
- Check whether personal property is paid at replacement cost or actual cash value.
- Read the deductible, and whether wind or hail has a separate one.
- Look for exclusions, especially flood, earthquake and sewer backup.
- Ask your agent about anything you do not understand, and keep a digital copy.
Stop and call a professional if
- you need a recommendation for your own loan, policy or tax situation: ask a licensed loan officer, housing counselor, insurance agent or tax professional
- your lender says your coverage does not meet the loan's requirements: ask your insurance agent and the lender what has to change
Questions to ask the professional
- What would it cost to rebuild this house today, and does my dwelling limit cover it?
- Is my personal property paid at replacement cost?
- Is sewer backup or flood covered, and if not, how would I add it?
Common mistakes
- Assuming flood damage is covered.
- Insuring the house at its market price rather than its rebuilding cost.
- Never updating the policy after a renovation.
Outside the US or in another state: Standard policy forms and required coverages vary by state and country.
Teach this to someone
A one page sheet for showing a friend, a teenager or a parent: what to say, what to show, and one question to check it landed.
Teach: What homeowners insurance covers
What to say
A standard homeowners policy covers the dwelling (the house itself), other structures such as a fence, your personal property, extra living costs if you must move out during repairs, and personal liability. Read the declarations page for each limit and your deductible. Check whether belongings are covered at replacement cost or actual cash value, and note that flood and earthquake are usually excluded.
What to show
- Find the declarations page, the summary at the front of the policy.
- Write down the dwelling limit and ask whether it would rebuild the house at today's costs.
- Note the limits for other structures, personal property and loss of use.
- Check whether personal property is paid at replacement cost or actual cash value.
- Read the deductible, and whether wind or hail has a separate one.
- Look for exclusions, especially flood, earthquake and sewer backup.
- Ask your agent about anything you do not understand, and keep a digital copy.
Where it stops
Stop and call a professional if you need a recommendation for your own loan, policy or tax situation: ask a licensed loan officer, housing counselor, insurance agent or tax professional.
Check question
Which is usually excluded from a standard homeowners policy?
Answer: Flood. Flood coverage is typically bought separately.
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Related skills
Sources
- State insurance regulator consumer guides for homeowners, 2025. Reviewed September 28, 2026.
Written in our own words from the sources above. It is general information, not advice for your situation; where a professional, your doctor or your lease says something different, follow them.
Last reviewed . First published .