Your home is likely your biggest investment — but many homeowners aren’t fully clear on what their policy actually covers.
Here are the most common questions we hear, explained simply.
What does homeowners insurance actually cover?
A standard homeowners policy typically includes:
- Coverage for your home (dwelling)
- Coverage for other structures (like garages or sheds)
- Personal property coverage
- Liability protection
- Additional living expenses if your home becomes uninhabitable
It’s designed to protect both your property and your liability as a homeowner.
What is NOT covered by homeowners insurance?
There are important exclusions, including:
- Flood damage
- Earthquake damage
- Normal wear and tear
- Maintenance issues
These risks often require separate coverage or planning.
Does homeowners insurance cover water damage?
It depends on the source.
Most policies cover sudden and accidental water damage, like a burst pipe.
But they typically do NOT cover:
- Flooding from outside
- Backup from sewers (unless added)
- Long-term leaks or neglect
Water claims are one of the biggest areas of confusion.
How much homeowners insurance do I need?
Coverage should be based on the cost to rebuild your home, not its market value.
This includes:
- Construction costs
- Materials
- Labor
Market price and rebuild cost are often very different.
What is replacement cost vs. actual cash value?
- Replacement cost pays to repair or replace items at today’s cost
- Actual cash value factors in depreciation
Replacement cost provides stronger protection, especially for your home and belongings.
Are my valuables fully covered?
Not always.
Items like:
- Jewelry
- Artwork
- Collectibles
…often have coverage limits.
You may need additional endorsements to fully protect high-value items.
Not sure what your homeowners policy actually covers?
You’re not alone — and that’s exactly why we’re here.
At Camargo, we help you understand your coverage in plain English so you can feel confident in your protection.
Let’s take a look together.