Homeowner's Insurance

"In my Father’s house are many mansions: If it were not so, I would have told you. I go to prepare a place for you." (John 14:2)

Thank goodness. I might be able to continue my insurance profession on the other side. Apparently, there are many mansions to insure and I have been told many of us might be in need of fire insurance!

That being the case, it is timely for us to know how homeowner’s insurance works. Provident living dictates we insure our most valuable belongings. Below is an outline of a typical homeowner’s insurance policy:


Dwelling: The building itself. Brick buildings (70%+) are given discounted rates.

Appurtenant Structures: Any structure not attached to the dwelling, such as storage sheds or fences. This coverage is usually 10% of the dwelling amount.

Personal Property: Your belongings are generally covered anywhere in the world, with limitations on personal property that should be scheduled.*

A good rule of thumb is anything that can be insured on its own (motorcycles, trailers, boats, etc.) will not be covered under the personal property portion of your homeowner’s policy. If you can purchase a policy on an item, then that is usually the way to get that item insured. This coverage is usually 70% of the dwelling amount.

Living Expenses: These are expenses created when you cannot live in your home due to losses from a covered peril. Included are the cost of a motel or apartment; eating at a restaurant, washing your clothing at a Laundromat, etc. Generally, any additional costs created when you cannot occupy your home until reconstruction is completed... up to your policy limits. This coverage is usually 20% of the dwelling amount.

If you have a claim, you will be responsible to pay a per occurrence deductible before the insurance pays anything on the above. Your deductible could be $250, $500, $1000, etc. I personally prefer higher deductibles because of the discounts given.

Deductibles generally do not apply for liability or medical.

Liability: If someone is injured or their property is damaged due to your negligence, your policy will pay up to the policy limits, depending on the exposure of the claim. Typical policies have a $100,000 limit, which is beginning to appear low by today’s standards. You can purchase higher limits, usually either $300,000 or $500,000. Even greater liability coverages can be purchased through an umbrella (excess liability) policy. As your assets grow, increased liability coverage is recommended.

Medical payments to others: If a non resident is injured on your property, even if you are not at fault, your policy will pay up to $1,000 per person for medical expenses. You can purchase additional coverage, generally $3,000, $5,000 or $10,000. Of course, if you are liable, your policy will pay up to the policy liability limits.

Quality homeowner’s policies cover fire, lightening, theft, windstorm, hail, vandalism, falling debris (like a tree falling on your roof), weight of ice or snow that could collapse your roof or building, broken pipes or appliances (the policy should cover damage caused, but will not fix the pipe or appliance),

Unless added, policies do not include earthquake or flood coverages. Either or both coverages can be purchased for an additional premium.

*Scheduled property is also available to insure specific items on an all risk basis. These items include guns, furs, musical instruments, silverware, collections - like a coin or doll collection - extensive electronics, mountain bikes, etc. You usually need a sales receipt or an appraisal to add coverage.

Best Wishes,

Neal Dastrup

1840 North State, Provo UT 84604

P) 801-374-1840 F) 801-377-5615 C) 801-358-4400
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