homeowners insurance: everything you need to know before you buy

Our homes are essential pieces of our lives, and if something were to happen to them, it would need to get fixed. Issues vary from minor fixes to major problems. These major issues can keep some people up at night as they can get extremely costly; this is where homeowners insurance comes in.

At its core, homeowners insurance is an insurance policy that covers losses and damages to your home and assets in the house. Homeowner insurance policies typically include additional living expenses (ALE) coverage. 

What Is Homeowners Insurance?

There are different types of insurance coverages in the US, and depending on which one you choose, it will change the amount you might receive from a claim.

Three Types of Homeowners Insurance

With actual cash value coverage, you’d be covered for the cost (how much you paid) of your home and belonging after accounting for depreciation (how much the house and belongings are currently worth).

Actual Cash Value

Replacement value policies are the same as actual cash value except it does not take depreciation into account. This would mean you would be able to receive the amount you originally paid for both your home and possessions.

Replacement Cost

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