Q:Why do I need home owner insurance?
A: You may need home owner insurance because your mortgage lender requires it. But, even if you own your home outright, you still need homeowners insurance to protect that which you can't afford to lose. It is really that simple. You spend years building up a solid financial foundation for you and your family. All that hard work can go down the drain in a matter of minutes when, for example, a tornado devastates your house, a burglar robs and vandalizes your home while you're gone, your dog bites and severely injures a neighborhood child, a guest in your home is hospitalized after falling on your icy stairs, or a neighbor sues you for personal injury after your chimney topples over on his head. There are virtually thousands of possible scenarios that could result in severe financial loss or even the loss of your home. home owner insurance is designed to help prevent that result. (Renters and owners of condominiums and cooperatives can get coverage using variations of the same basic insurance tailored to their needs).

Q:How can I save money on my home owner insurance?
A: You can save money on home owner insurance by increasing the deductible amount on the policy. The deductible is the amount a homeowner pays on any given claim. How much you will save by increasing your deductible from $250 to $1,000 will vary from one company to the next. But it could reduce your annual premium by as much as 25 percent.

Q:Is guaranteed replacement insurance better than standard home owner insurance?
A: Yes and no. Guaranteed replacement insurance is more comprehensive and costly than standard homeowners insurance, but not necessarily better. It completely covers the cost of replacing a destroyed house even if the cost to rebuild is more than the policy's limit. Standard home owner policies usually limit replacement costs. However, guaranteed replacement policies are not available on every property. Insurance companies frequently will not issue such policies on older homes, for example.

Q:What does a home owner insurance policy cover?
A: A standard home owner insurance policy protects against fire, lightning, wind, storms, hail, explosions, riots, aircraft wrecks, vehicle crashes, smoke, vandalism, theft, breaking glass, falling objects, weight of snow or sleet, collapsing buildings, freezing of plumbing fixtures, electrical damage, and water damage from plumbing, heating or air conditioning systems. Special coverage, such as earthquake protection, typically requires a special policy.

Q:Will my insurance policy have limitations on coverage?
A:Yes. For example, most policies will not cover loss from flooding, earthquakes, or landslides. You may be able to purchase endorsements to cover such disasters. Flood insurance is available through the federal National Flood Insurance Program.