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Property Insurance
by: Sahil | last updated: November 27, 2009
Category: Homeowners Insurance | Tags: Property insurance, home insurance
Category: Homeowners Insurance | Tags: Property insurance, home insurance
Property insurance provides safety against damage to the property due to fire, theft or some other type of damage due to weather. Specialized forms of insurance can be bought under property insurance such as flood insurance, fire insurance, earthquake insurance, and home insurance. Property insurance is covered in two ways against open perils and against named perils.
Open perils often include those losses that are not covered in the insurance except losses arising due to – earthquakes, floods, nuclear incidents, terrorism, and war. Named perils usually require a clause in the policy to mention the peril in order to get any compensation. The most common perils include but are not limited to theft, fire, lightning, and explosion.
In case of fire insurance there are three types of coverage which make up for loss due to fire. The replacement cost pays the amount required for replacing your property regardless of the depreciation or appreciation in the price of the same. Extended coverage will pay over the coverage limit if the costs of construction have increased. Actual cash value is the amount calculated by subtracting the amount of depreciation from the replacement value.
Home insurance is a part of property insurance and also covers places of business; although property insurance does not provide cover against war, terrorism, or hurricanes many people have won cases against insurance companies in this regard. The two notable cases being the World Trade Center reconstruction and a case in Florida where damage occurred due to hurricane Katrina.
Property insurance also covers business owner’s policy (BOP) and is extensive in nature. Usually a Business owner’s policy includes property insurance, business interruption insurance, casualty or liability protection, vehicle coverage for rented or borrowed vehicles, and a number of other coverage.
A number of coverages such as earthquake insurance and flood insurance may not be covered in a business owner’s policy and may have to be bought separately. The types of extensive insurance required completely depend on the actual location and weather of that place. For example extensive insurance on the east coast differ from those on the west coast because of different climatic conditions.
The condition of Florida in the Home Insurance sector is infamous because many insurance companies have pulled out of the region due to heavy losses. The United States government is taking some steps in order to provide insurance to people in Florida at a reasonable rate. The reason behind this is the frequent natural calamities such as hurricanes that are rampant in the sunshine state.
Thus home insurance is a subset of property insurance that includes but is not limited to home insurance. Property insurance is extensive and more specialized that also includes insurance for business entities and other additional property. The features of property insurance also vary greatly according to the country, the region and the climate.
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