ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Homeowner Insurance Basics

Updated on December 13, 2012
Photo from
Photo from

There is a lot to think about when looking for homeowners insurance.

When I first learned about home insurance I wanted to know the basics and I had a lot of questions: What is home owners insurance? and do I have to get it right away? What does homeowner insurance cover? How much does it cost?

Do you need homeowner insurance?

If you buy a home you need homeowner insurance. Most lenders require the homeowner to find home insurance prior to lending. The reasoning here is pretty clear: if the borrower/homebuyer defaults on the loan the only assurance the bank has of getting their money back is by way of the home. If the home burns down and it is not insured the bank could be left with much less than required to fulfill the loan. The banks are not going to let this happen so homeowner insurance is likely required.

The minimum amount of coverage required is determined by the lender who generally would like 70-95% coverage of the cost of the loan. However the amount you want to ensure your home is up to you. Often times the minimum amount of insurance is procured for the purchase of the home and the loan transaction and then the homeowner can later shop around for a different insurance policy.

Homeowner insurance coverage.

When you buy a house you are buying the house and the land the house sits on. Homeowner insurance just covers the dwelling(s) on the land. Separate structures like detached garages and barns are also included in homeowner insurance and will add to the cost of the insurance policy. Personal property is insured on a typical homeowner insurance policy and it covers theft and loss of all your stuff.

Homeowner insurance should also cover personal liability. This means if someone hurts themselves badly at your house and you were liable the insurance company covers related expenses. Usually a policy has a "guest medical" amount also that can be used towards medical bills for someone who is hurt on your land whether you were liable or not. This is a bit of an appeasment tactic by the insurance companies to discourage lawsuits. By adding this feature insurance companies found that $1,000 towards medical bills can save hundreds of thousands in a liability suit payout.

How much does homeowner insurance cost?

The cost of homeowner insurance can vary greatly. But it is very reasonable. Here is an example: Homebuyer purchases a home with the sale price of $280,000. The homebuyer has $30,000 to put down and secures a loan for the remainder of $250,000. The lender requires homeowner insurance coverage of at least 85% of the loan. The insurance policy has dwelling coverage of $220,000 which includes $1,000 for guest medical, $300,000 in liability coverage and $200,000 for personal property. This policy costs homeowner $1,100 a year.

Now that you are armed with some knowledge about homeowner insurance go and shop around. Rates will not fluctuate much so comparison pricing is possible. Check with your car insurer as often times a bundled package of car and home insurance can lower the overall cost of the policy. Also try and find an insurance agent who is unaffiliated to any one insurance company and can shop around for the best policy prices. Ultimately be sure that your insurer is reputable.

Check out some of these related hubs:

6 Tips For Buying A House

The Homebuyer Tax Credit And Revised Form 5404


This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

Show Details
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
ClickscoThis is a data management platform studying reader behavior (Privacy Policy)