Oregon Home Insurance Coverage Explanations

The Oregon home insurance coverage explanations will provide you with an understanding of the main functions of home insurance. In it's simplicity your Oregon home insurance policy will save you from:

  • Severe financial loss if your home is damaged or destroyed.
  • Damage and loss to your family's possessions.
  • Financial loss due to liability claims, medical expenses, and other amounts that result from property damage and personal injury suffered by others.

The six basic coverages of a home insurance policy are:

  1. Dwelling Coverage, covers damage to your home.
  2. Other Structures Coverage, covers structures not attached to your home such as a detached garage, tool shed or gazebo.
  3. Personal Property Coverage, covers the contents of your home from furniture to clothing.
  4. Loss of Use Coverage, will provide money if you need to relocate while your home is being repaired due to damage from a covered loss.
  5. Personal Liability Coverage, provides protection for claims arising from bodily injury or property damage of you & your family members cause to other people. This also includes family pets.
  6. Medical Payments Coverage, provides coverage if someone suffers a minor injury on your property.


1. Dwelling Coverage - this coverage insures the structure, your home, and attached structures from damage resulting from these perils:

  • Fire and lightning
  • Windstorm and hail
  • Explosions
  • Theft, vandalism, and malicious mischief
  • Riot and civil unrest
  • Damage from vehicles
  • Sudden, accidental damage from smoke
  • Aircraft and objects falling from the sky
  • Volcanic reuptions
  • Weight of snow, ice, and sleet
  • Accidental discharge or overflow of water or steam from your plumbing
  • Freezing of plumbing
  • Sudden, accidential tearing, cracking, burning or bulging of a steam pipe or hot water heating system
  • Suddent and accidental damage from artificially generated electrical current


A home insurance policy will exclude a loss due to flood, earthquake, and landslide. Flood insurance is available through the federal government's National Flood Insurance Program, earthquake insurance is available as an optional coverage as well as losses resulting from landslides.

Two types of insurance policies exist for the replacement of your Oregon home:

1. The first is called Guaranteed Replacement Cost. With this type of coverage, once you've met your deductible, the insurer promises to pick up the cost for rebuilding your home regardless of what the cost is to rebuild the home. If your home is insured for $200,000 and it ends up costing $275,000 the company will rebuild it without carrying any of that cost over to the you.Most companies have eliminated this type of coverage; among the companies I represent which provide Guaranteed Replacement Cost are Ace, Chubb, and Fireman's Fund.

2. The second type of coverage is Extended Replacement Cost. This is designed to cover rebuilding your home based on the declared value on your policy with an additional 25% – 50% cushion to protect you if there is an increase in labor and building materials.

Home insurance will protect more than just the owner of the house. Generally, it will protect anyone named on the policy, your spouse, residents of the home (other than renters), household employees, guests and visitors.


2. Other Structures - 'Other Structure' is considered to be separate and distinct from the dwelling by clear space or connected to the dwelling by a fence, wall, wire, or a similar type of connection. Most policies provide your other structure coverage limit at 10% of what ever your home is insured at. Examples of these types of structures would include a barn, shed, detached garage, gazebo, fence or other structure not attached to your home. The other structures coverage insures these structures against the same risks that covers your dwelling.

3. Property / Personal Belongings Coverage - The property or personal belongings insurance portion of your home insurance policy protects loss or damage to your personal property. Most policies provide your personal property coverage limit at 70% of what ever replacement cost limit your home is insured at.

Property used for business purpose isn't considered personal property and limited coverage is provided. If you have more than $5,000 in property that is used for business purposes please let me know so I can provide you with a business insurance quote to provide coverage for your business personal property.


There are often limitations with property coverage and some property might not have full replacement cost coverage. Adding a schedule will insure your property on a scheduled basis, this means that each item is listed and described on your policy. This will provide a separate limit of insurance for each, based on an appraisal or bill of sale.

  • The types of property for which this coverage is used is jewelry, furs, cameras and photographic equipment, musical instruments and equipment, silverware, golf equipment, stamp and coin collections, and fine arts.
  • With a schedule there are no limitations or exclusions as the schedule will cover any type of loss other than wear and tear.
  • There is no deductible to pay when you file a claim with a scheduled piece of property

 

An inventory of your personal belongings is a good idea. When you have to file a claim it is to your advantage when you have documentation to prove your losses. When creating this inventory provide the serial number, date, cost of purchase and include receipts if possible. An easy way to inventory your possessions is to use a video camera or take digital photos and forward those pictures to a web based email account so you can access them anywhere.

You can create a home inventory by downloading this personal organizer.

Why create a personal organizer?

Remembering all the contents of your house and garage after a fire, theft, or other calamity is practically impossible. That's what you'll be asked to do when you submit a claim on your homeowner's insurance, unless you previously prepared a written inventory of your household possessions and property. Considering that the whole point of buying homeowner's insurance is to obtain compensation for financial loss, why bet the farm (or your house and its contents) on your memory, or add to the emotional loss and stress which comes from any type of loss?


4. Loss of Use Coverage - If your home is not fit to live in as a result of a loss, your home insurance policy will cover your "additional living expenses". The policy will provide reimbursement for your families household's living expenses while you wait to permanently relocate or wait for the dwelling to be repaired. The dollar limit on this type of coverage is typically 20% of your home's replacement cost limit. There may also be a time limit on this type of coverage such as 12 or 24 months.

An example of how this coverage works would be if your mortgage is $1,500 per month, you suffer a loss and it costs you $3,000 to stay in a hotel for a month you would be reimbursed for the difference in your living expenses. Also if you needed to board a pet in a kenneel and eat out at restaurants this is the coverage that pays for expenses beyond what you'd normally pay for daily living.

5. Personal Liability Coverage - If you or another insured are found responsible & liable for personal injury or property damage suffered by another person, your insurance company will investigate the event and might offer a settlement amount owed to that person through your liability coverage. This is only true if carelessness or negligence, rather than intentional misconduct, caused the injury or damage.

For example, you may be found negligent if a postal worker was injured by falling off your tricky front stairs because the railing was broken (and you knew about the situation but failed to repair it). You may also be found liable for intentional misconduct if you cut down a tree on your neighbor's property to improve your view.

There is no deductible with liability claims.


6. Medical Payments Coverage - If a nonresident of the home requires medical assistance as a result of a minor injury suffered on or near your premises, your insurance company can pay his or her medical expenses with the medical payment to others coverage. This covers necessary medical expenses incurred within 3 years of an accident causing bodily injury and would include charges for medical, surgical, x-ray, dental, ambulance, hospital, professional nursing, and funeral services.

Medical payments to others does not apply to injuries of named insureds or any regular resident of the household. Medical payments to others is a good will payment in the hopes of preventing a larger lawsuit down the road as the payment should not be construed as admitting liability.