Hazard insurance and homeowners insurance are often mistaken for the same thing due to the similarities they share. While standard homeowners insurance policies include hazard coverage, standalone hazard insurance serves a different purpose.
How do you know if you need hazard insurance? Here is a guide to help you understand the basics:
Hazard insurance vs. homeowners insurance
Hazard insurance can protect you financially from damage caused by hazards like fire, lighting, wind and other natural events. While homeowners insurance includes protection from a broad range of hazards, certain specific events are excluded.
In certain areas where specific hazards like tornadoes or earthquakes are common, you may be required to get a separate hazard insurance policy. This combined with your regular homeowners insurance coverage means you’re prepared for anything.
Another key point of comparison of what these two types of insurance will pay to replace. Hazard insurance typically refers to coverage for the structure of your home, including the roof and foundation. Homeowners insurance, however, includes coverage for your personal belongings and furnishings.
How to know if you need hazard insurance
Whether you should have additional hazard insurance largely depends on where you live. In regions prone to flooding, for example, your mortgage lender might require you to get a flood insurance policy before approving you for a loan.
Even if not required, having hazard insurance coverage can give you peace of mind. If you have an additional hazard policy, you’ll know you have financial coverage if your home and belongings are damaged in an extreme weather event.
By comparing the hazard insurance cost with the potential cost of replacement and repairs, you can determine whether it makes sense to add it into your budget. Consult your insurance company to find out what options you have and whether a hazard insurance policy is right for you.
About the Author
Rudden|Bobruska Team
Gary Rudden, Lisa Rudden, and Nick Bobruska
RUDDEN BOBRUSKA TEAM
What sets your team apart from other real estate teams?
There is no team out in the market that offers what we do. All of us are Realtors, but
we each have specialized roles, which make our team so unique!
After decades of living and selling real estate in the DMV, we have established
ourselves as one of the top real estate teams with our market expertise and
cutting-edge technology. Our savvy high-tech marketing is on every website
and social media source. We have a huge network with other top agents, which
helps to premarket homes and discover homes for buyers before they reach the
open market. Our services include professional in-house staging services, broker
expertise in negotiating and navigating contracts, and buyer representation in all
price ranges. Each client has different needs and we create a marketing plan based
on those needs.
Our most distinct feature is our in-house construction and renovation team. We
are literally a full-service, one-stop shop when selling or buying a home!
How does the in-house construction and renovation team work?
All work is managed and completed through our licensed and bonded construction
crew. No need to call outside contractors. We are like “HGTV,” but we just don’t
have a show! Whether it’s a small makeover or a major renovation, we do it all. Our
sellers love this aspect of our team because we make preparing your home for the
market so seamless. Our buyers love the advice and insight we can give for future
renovations and repairs.
Having a licensed Maryland Home Improvement contractor as part of our team
along with the knowledge, experience, commitment and services that we offer, truly
puts our team as a vanguard in the real estate industry.