Homeowners vs. Home Insurance: What’s the Difference?
When shopping for property insurance, you may hear the terms homeowners insurance and home insurance used interchangeably. While they are closely related, they do not always mean the same thing.
Homeowners insurance refers to a specific type of policy for people who own and live in their homes. Home insurance can be used more broadly to describe several types of insurance designed for different kinds of residences.
What Is Homeowners Insurance?
Homeowners insurance is a type of property insurance designed for people who own and live in their homes.
A homeowners policy typically includes coverage for:
- The structure of your home, including walls, the roof, foundation and attached structures
- Personal belongings, such as furniture, appliances, electronics and clothing
- Liability protection if someone is injured on your property
- Additional living expenses if you need temporary housing after a covered loss
Mortgage lenders almost always require homeowners insurance because it helps protect both your investment and theirs.
What Does “Home Insurance” Mean?
In everyday conversation, home insurance is often used as shorthand for homeowners insurance. But the term can also refer more broadly to insurance products designed for different types of residences.
Those can include:
Condo Insurance
Condo insurance, also known as an HO-6 policy, covers your personal belongings and interior walls, while the condo association covers the building structure.
Renters Insurance
Renters insurance, or an HO-4 policy, covers a tenant’s personal belongings and liability. It does not cover the building itself.
Landlord or Rental Property Insurance
Landlord or rental property insurance, sometimes referred to as a DP policy, covers the structure and liability associated with a rental property.
It does not cover the tenant’s belongings.
Homeowners Insurance vs. Home Insurance
The simplest distinction is that homeowners insurance is a specific type of policy, while home insurance can describe a broader range of property-related policies.
The type of coverage you need depends largely on your relationship to the property.
If you own and live in the home, a homeowners policy is designed for that situation. If you own a condo, rent your home or insure a rental property, another type of home insurance may be appropriate.
Finding the Right Type of Home Insurance
Understanding the different types of home insurance can help you choose coverage that fits your property and avoid potential gaps.
Start by considering your property type and the risks you need to protect against. Then, work with a trusted insurance agent to determine which type of coverage is appropriate for your situation.[/vc_column_text][/vc_column][/vc_row]