Homeowner’s Insurance covers your house, as well as your belongings within the home, in the event of an insured loss. Some of these insured losses include fire, burglary, theft, tornado, storm, and back up of sewer or water damage. Earthquake and Flood are usually sold separately.
Quite often, mortgage companies require that the homeowner carries Homeowner’s Insurance before giving a loan to buy a new house or refinance. Mortgage companies want the homeowner to carry insurance so that in the case of a catastrophe the amount owed to them will be paid.
Homeowner’s Insurance policies also offer a set amount of Liability Coverage that will cover any bodily injury that occurs on the property, to protect the homeowner from being sued. Liability insurance serves as a limited amount of protection for the homeowner’s assets and family in the case that a civil suit arises.