If lightning hits your house, be glad you have hazard insurance.
The hazard insurance in HO-3, the standard homeowner's insurance policy, protects homes against any damage except those specifically exempted in the policy. It protects the contents, such as clothes, furniture, appliances and books, against damage from 16 "named perils," the Insurance Information Institute states. In addition to hazard insurance, H0-3 also provides liability protection; most policies also offer living expenses if you have stay elsewhere while your home is being repaired.
Different types of hazard insurance offer different levels of help when you repair or rebuild, the Investopedia website states. Cash-value policies will pay what it originally cost you to buy something--a television or a couch, say--depreciated for the number of years you've owned it. With a replacement-value policy, you receive enough money to buy a new
item, regardless of depreciation. Guaranteed or extended-replacement cost will pay to rebuild the house even if the price is more than the limit on your policy.
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