A simple breakdown of what’s covered—and what isn’t.

Your homeowners insurance policy is more than paperwork—it’s a legal contract that defines what your insurer will pay for, how much they’ll pay, and under what conditions. The challenge? It’s written in complex language that’s easy to misinterpret.

At The Claims Authority, we believe knowledge is power. Here’s what every homeowner should understand about the major sections of their policy and what they really mean for you.

Email Us

Understanding Your Homeowners Policy

🏠 Coverage A – Dwelling (Structure)

This section covers the main structure of your home—the walls, roof, floors, built-in appliances, and other integral components.
It’s designed to rebuild or repair your home after covered perils like fire, wind, hail, or water damage (depending on your policy).

Key takeaway:
Coverage A is usually based on replacement cost, not market value—but it must be high enough to rebuild your home as it stands today. If construction costs rise, you may be underinsured without realizing it.

🏡 Coverage B – Other Structures

This applies to property not attached to your main dwelling, such as: detached garages, gence, guest houses or ADUs, sheds and gazebos

Key takeaway:
Coverage B is often capped at 10% of Coverage A, but can be increased if your property has extensive outbuildings or improvements.

🛋️ Coverage C – Personal Property (Contents)

This covers your belongings—furniture, clothing, electronics, and personal items.

Two valuation methods are common: ACV (Actual Cash Value): Pays for items minus depreciation or RCV (Replacement Cost Value): Pays to replace them with new equivalents.

Key takeaway:
Certain high-value items (jewelry, artwork, firearms) may require scheduled coverage or separate riders to be fully protected.

🧳 Coverage D – Loss of Use / Additional Living Expenses (ALE)

If your home becomes uninhabitable due to a covered loss, this section pays for temporary living costs such as: hotel or rental accommodations, meals and laundry, and increased travel or utility expenses

Key takeaway:
Keep all receipts. ALE can be a major part of your recovery, but only if it’s properly documented.

👥 Coverage E – Personal Liability

This protects you if you’re found legally responsible for injury or property damage to others.
It typically covers: legal defense costs, settlements or judgments (up to policy limits)

Key takeaway:
Liability limits are often too low. Increasing them is one of the most affordable ways to protect your assets.

💼 Coverage F – Medical Payments to Others

This provides no-fault coverage for minor injuries that occur on your property—think a guest tripping on a step or a delivery driver slipping on the walkway.

Key takeaway:
These payments are generally small (often $1,000–$5,000), but they can prevent minor incidents from escalating into larger liability claims.

🌪️ What’s Not Covered

Every policy includes exclusions. Common ones include:

Flood (requires a separate NFIP or private flood policy)
Earthquake (available as an add-on in select regions)
Mold (limited coverage or exclusions vary)
Wear and tear, neglect, or pre-existing conditions

Key takeaway:
Just because damage exists doesn’t mean it’s covered. The cause of loss—and how it’s documented—determines everything.

🧭 Why This Matters

Understanding your policy helps you make informed decisions before disaster strikes. But when it does, having an expert on your side ensures your coverage works the way it should.

At The Claims Authority, we interpret, document, and negotiate every claim with precision—so your policy becomes a tool for recovery, not confusion.

📞 Schedule a Free Policy Review