Homeowners and renters insurance protect your home and personal property against damage or loss, and insures you in case someone gets hurt while on your property. You may already have insurance on your home if you have a mortgage on the property, because most lenders make insurance a condition of the loan.

Renters insurance, or tenant insurance, offers renters coverage similar to homeowners insurance. If you are a renter, do not assume your landlord carries insurance on your personal belongings; you may wish to purchase a separate policy.

What Can Homeowners or Renters Insurance Cover?

Homeowners or renters insurance may pay claims for:

• Damage to your home, garage, and other outbuildings.
• Loss of furniture and other personal property due to damage or theft, both at home and away.
• Additional living expenses if you rent temporary quarters while your house is being repaired.

Homeowners or renters insurance may also:

• Include liability for bodily injury and property damage that you cause to others through negligence.
• Include liability for accidents happening in and around your home, as well as away from home, for which you are responsible.
• Pay for injuries occurring in and around your home to anyone other than you or your family.
• Provide limited coverage for money, gold, jewelry, and stamp and coin collections.
• Cover personal property in storage.

Keep these tips in mind when shopping for homeowners insurance:

• Insure your house, not the land under it. If you don’t subtract the value of the land when deciding how much homeowner’s insurance to buy, you will pay more than you should.
• Make certain you purchase enough coverage to replace what is insured. “Replacement Cost Coverage” gives you the money to rebuild your home and replace its contents. An “Actual Cash Value” policy is cheaper but pays the difference between your property’s worth at the time of loss minus the depreciation for age and wear.
• Ask about special coverage you might need. You may have to pay extra for computers, cameras, jewelry, art, antiques, musical instruments, stamp collections, etc.
• Flood and earthquake damage are not covered by a standard homeowners policy. The cost of a separate earthquake policy will depend on the likelihood of earthquakes in your area. Homeowners who live in areas prone to flooding should take advantage of the National Flood Insurance Program (NFIP)
• If you are a renter, do not assume your landlord carries insurance on your personal belongings. Purchase a separate policy for renters.

For help in deciding how much insurance coverage to buy, contact your state insurance regulator.