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Homeowner insurance provides you financial protection in the event that your home is destroyed or damaged due to an unforeseen or catastrophic event. In addition to your home, homeowners insurance also covers your belongings (or personal property) and can reimburse you for medical expenses and liability claims resulting from property damage and personal injury to other people caused by you or members of your family. There are two basic types of homeowners coverage: ALL RISK POLICY - offers broad protection and covers all perils unless they are specifically excluded by the policy. NAMED PERILS POLICY - offers narrower protection than an all risk policy and covers only those perils specifically named under the policy. A named perils policy will also contain exclusions to perils named under the policy. Policies also offer different methods of repairing or replacing your property: REPLACEMENT COST - pays for all necessary expenses associated with rebuilding or repairing damaged property, up to the policy limits, less any applicable deductible amount. ACTUAL CASH VALUE - factors in depreciation costs to your claim and pays you the costs to replace or repair the damaged property, less depreciation and less any applicable deductible amount. |