Are you confused about the difference between home insurance and hazard insurance? Then follow along to learn more about these two common insurance terms and discover other useful facts about home insurance.
Is Home Insurance the Same as Hazard Insurance?
Yes, but only partially. The term “hazard insurance” (also known as “dwelling coverage”) refers to the part of your home insurance policy that provides coverage for the physical structure of your home.
In addition to hazard insurance, a typical home insurance policy features other components that shield your home from other risks. Some examples of these additional components include coverage for your personal belongings, liability protection, and additional living expenses, or ALE.
Hazard insurance usually offers protection against risks that affect the structure of your home, such as:
- Riots or civil unrest
Very often, people use the term “hazard insurance” to refer to home insurance. While this is acceptable in everyday conversation, it’s important to keep the difference in mind when you see the term included in the wording of your policy.
Hazard Insurance and Mortgages
If you take out a mortgage, most lenders will require you to have hazard insurance. This may be confusing if you are not aware of the relationship between hazard insurance and home insurance.
The good news is that if you have home insurance, you are good to go because, as mentioned earlier, hazard insurance is part of home insurance.
It’s worth noting that you usually can’t purchase hazard insurance as a standalone coverage. If you are required to show proof of hazard insurance, you’ll need to purchase a home insurance policy.
RF1 Insurance Services: Home Insurance in Southern California
Looking for home insurance you can rely on? At RF1 Insurance, we work with some of the world’s most trusted insurance companies, including Safeco, Guard, Stillwater, National General Premier, Aegis, and the California FAIR Plan.