Property insurance is commonly – and incorrectly – understood to be the same as home insurance. While the two types of insurance can be very similar, there are some important differences between them. More accurately, homeowners insurance can be seen as one of many types of property insurance. Other kinds of coverage that fall under the umbrella of property insurance include:
- Condo insurance
- Tenant (renters) insurance
- Revenue property insurance
- Seasonal/second home insurance
Property insurance defined
Property insurance is a policy that exists to provide financial reimbursement to the owner of the insured structure and the contents within, in the event of damage or theft. It can cover anything from the structure itself, to personal property – furniture, artwork, jewelry, etc. – as well as detached structures that are within the confines of the property covered, such as fences and storage sheds. In many cases, liability coverage is part of the protection received. It can also offer protection against damages incurred by natural occurrences like earthquakes and storms, though it is not common that they do.
All perils vs. named perils
Many property insurance policies offer the option of All Perils or Named Perils coverage. All Perils policies generally cover any damages as the result of theft, fire, smoke, wind, hail and many other weather-associated losses. But, these types of policies cover what the insurance company perceives to be the greatest risk. So while the coverage may be broad, it’s unlikely to cover everything.
Named Perils, on the other hand, offers protection only against perils that have been specifically named within the policy, and include common risks such as fire and theft. Many Named Perils policies are cheaper than All Perils, but it depends on the types and extent of Named Perils included, which can really add up. For example, the policy holder can choose to purchase a Named Peril policy that covers holes in their existing policy – this could be floods, earthquakes, or some other occurrence that is not included in All Perils policies.
Finding the right property insurance
Choosing a property insurance policy that is right for your needs can be much easier with the help of an experienced insurance broker. The team at Mitch can walk you through the different options available to you, and ensure you get the coverage that best protects your property, at a price that works for you.