If you own a home or commercial property (or both), then you have likely purchased or have at least considered purchasing property insurance.
Whether it is residential or commercial, property insurance is designed to protect your assets against most risks, including fire, theft, and some types of weather damage.
The property insurance category includes specialized types of insurance including homeowners’ insurance, renters insurance, flood insurance, earthquake insurance, and boiler insurance – some or all of which you may need depending on your location and the type of property that you own.
What is Property Insurance?
Property insurance is an umbrella term for the types of insurance policies that are designed to provide property protection coverage or liability coverage, the latter of which is also referred to as property and casualty coverage and covers damages if someone other than the owner or renter is injured or even killed on the insured property.
The former – property protection coverage – is an essential for any homeowner or property owner.
It is meant to provide financial remuneration or reimbursement to the property owner (or renter as the case may be) if there is weather damage or theft.
This type of insurance usually covers the contents of the property, but any uniquely valuable items may require additional riders, endorsements, or specialty insurance coverage.
While property insurance covers many events or issues that can result in damage to a property and its contents including theft, vandalism, fires, and major storms, some things are not covered.
The things that are covered under your property insurance are referred to as “named perils” and while the covered perils may vary by policy, certain occurrences are almost always not covered and will require additional or supplementary property insurance policies.
Why Do I Need Property Insurance?
If you own property of any kind, then you need to insure it for your own protection.
After all, if your assets are damaged, then you’ll want to recoup the replacement or repair costs from your insurance company.
In addition, many landlords or mortgage lenders require that you have property insurance – they want to protect their investment too.
If you have paid off your property, you are not legally required to carry property insurance – but it is a wise decision to carry this type of insurance anyways.
Not only will it cover damage to your home, theft of its contents, but it will even provide you with coverage for the costs of temporary shelter and living arrangements if you are displaced due to a weather event, fire, or other disaster.
Business owners or anyone who owns commercial property will also want to make sure that their property insurance not only covers the integrity of the building or buildings themselves, but also the contents of the buildings.
This should include damage to inventory stored in the buildings (this is particularly important if you have a warehouse or significant amounts of product stored at the property) and any machinery housed at your commercial property.
When you are determining the amount of commercial property insurance that you need, consider not only the worth or value of the inventory and equipment you have at the property, but the cost of the disruption in doing business if your property is damaged, vandalized, or burglarized.
What Kind of Property Insurance Do I Need?
The type or types of property insurance that you need depend on your location and the potential for various types of natural disasters (e.g. flood insurance if you live on or near a flood plain or a large body of water, earthquake insurance if you live in an area that is prone to earthquakes, etc.).
An ASCO insurance agent can help you determine what types of coverage you need for your unique property and location.
What is Covered Under Property Insurance (and What Isn’t)?
It’s important to understand what is covered under your specific property insurance policy.
Flood insurance and earthquake insurance are two common exclusions, but always check your individual policy and ask your insurance agent about your coverage if you are unsure or think you need to be covered for things that are commonly excluded.
Property insurance does cover theft or burglary of the contents of the property and associated damage as well as vandalism to the property.
Natural disasters or acts of god that are covered under property insurance include fire and the requisite smoke damage, wind damage, hail damage, damage from snow and ice, lightning strikes, and related weather events.
Things that are not normally covered under property insurance and may require additional policies include hurricanes and tsunamis, earthquakes, floods, drain and sewer backups, seeping groundwater, standing water, and related water damage that was not the result of a major storm.
Mold is also generally not covered by property insurance.
Extreme events like acts of war, terrorist attacks, or nuclear strikes are not covered by standard property insurance policies.
How Much Does Property Insurance Cost?
The cost of property insurance varies depending on the value of your property, its location, and the types of coverage that you need.
The minimum amount of property insurance that you need to carry often depends on the requirements of your mortgage lender and the value of your mortgage.
Be aware that most property insurance policies start at $100,000 in damages, but depending on the overall value of your home or other property and its contents, you likely want to increase the amount of insurance coverage that you carry.
Typically, property insurance covers theft or burglary of the contents of the property and associated damage as well as vandalism to the property.
Natural disasters or acts of god that are covered under property insurance include fire and the requisite smoke damage, wind damage, hail damage, damage from snow and ice, lightning strikes, and related weather events.
Things that are not normally covered under property insurance and may require additional policies include hurricanes and tsunamis, earthquakes, floods, drain and sewer backups, seeping groundwater, standing water, and related water damage that was not the result of a major storm.
Mold is also generally not covered by property insurance.
Extreme events like acts of war, terrorist attacks, or nuclear strikes are not covered by standard property insurance policies.
What Types of Insurance are Related to Property Insurance?
Property and casualty insurance as well as various types of specialty insurance are all related to property insurance.
An ASCO insurance agent can help you put together a package or bundle of insurance policies that best fit your needs and keep your most valuable assets – your home or commercial property – covered in case of disaster.
Contact ASCO insurance today to find the best property insurance policy for you.
