Important Home Insurance Terms to Know

Basic homeowners insurance terms for first-timers.

If you are buying your first home, then it will also be your first time dealing with homeowners insurance in Carrollton, Texas.  Because a home is such a major investment, it’s vital that you secure the right policy to keep it safe.  Unfortunately, many first-time homeowners have trouble understanding the insurance terms that their agents throw around.  To help you make an informed home insurance decision, here are some of the most commonly-used terms explained.


Your deductible is the amount of money that you agree to pay towards a claim before your insurance coverage kicks in.  Deductibles are a way for the policyholder and insurer to share the cost of coverage.  Typically, assuming a higher deductible means lower insurance premiums because you are assuming more responsibility for claims.

Liability Insurance

Your homeowners insurance policy is made up of several different types of coverage.  One of the main types of coverage included in your policy is liability insurance.  Liability insurance protects you and your family from legal claims that arise due to the following:

  • Third-party injuries that take place on your property
  • Third-party property damage that takes place on your property
  • Injuries that you or a family member accidentally cause off-property
  • Property damage that you or a family member accidentally cause off-property
  • Pet-related injuries or damages (assuming that your insurance provider offers coverage for your pet’s breed)

Liability insurance will cover the medical and compensation costs of affected parties.  This type of insurance will also cover the cost of your legal defence should the affected parties decide to sue.

Dwelling Protection

Dwelling protection is one of the main coverages included in home insurance policies.  This portion of your policy offers coverage for the physical structure of your home and all the components that are attached to the home.  This includes things like flooring, cabinetry, fireplaces, attached garages, decks, and so on.  Your dwelling protection will help you pay to repair the damages your home sustains during a covered peril, such as a storm, fire, break-in, and so on.

Other Structures Protection

This refers to the coverage you have for structures on your property that are not directly attached to your home.  For instance, other structures can refer to things like fences, carports, sheds, and so on.  Other structures protection will usually offer coverage up to 10% of your total dwelling protection.  So, if your policy offers $250,000 in dwelling coverage, then you will have $25,000 of other structures protection.

Additional Living Expenses Coverage

Additional living expenses is one of the main types of coverage included in your homeowners insurance policy.  If your home is made uninhabitable due to a covered peril, then this coverage will help you cover the cost of temporarily living elsewhere.  This coverage will help you pay for things such as hotel stays, temporary apartment/home rentals, restaurant bills, clothing, pet boarding, and so on.

These are some of the important home insurance terms that you should know.  Do you need further assistance with your homeowners insurance in Carrollton, Texas?  If so, then contact the experts at Mike Leonard Insurance Agency.  Our dedicated team is eager to find you the right coverage from one of our many carriers, including: Kemper, MetLife, Nationwide, Travelers, Safeco Insurance, Progressive, and American Strategic Insurance.