HOMEOWNER'S INSURANCE!

THE BASICS:

Homeowner's insurance comes in many shapes and sizes.  The most common form, "HO3," is known as "open peril" coverage.  This means that your house is covered against most perils (Fire or lightning, windstorm or hail, explosion, riot or civil commotion, damage caused by aircraft, damage caused by vehicles, smoke, vandalism, theft, volcanic eruption, falling object, weight of ice, snow, or sleet, accidental water overflow or steam, sudden and accidental tearing apart, cracking, burning, freezing, sudden and accidental damage from electrical current).  It can also protect you against personal injury claims, cyber crime and water backup (sump pump) damage, and can provide money for medical expenses of injured parties, additional dwelling coverage, personal property and additional living expenses.  

Condo coverage, "HO6," is similar, but insures against fewer perils, and only insures you against damange to the inside of your unit.  HO4, or "renter's insurance," can be purchased by someone who rents a home (regardless of the type of home), and it covers contents and liability.

It's getting more difficult to purchase affordable homeowner's insurance, as carriers are increasing restrictions and being more selective in terms of which risks they're willing to insure.  Occasionally a homeowner may be rejected by all "admitted" carriers (those who are financially backed by the state's insurance guaranty association) if he has a claim history or lapse in coverage, and will need to purchase insurance from a non-admitted carrier in what is called the "excess and surplus" market.  ($$$)