What Does Homeowners Insurance Cover? A Beginner’s Guide

Your home is more than just a place to live—it’s one of your biggest investments, and protecting it should be a top priority. But when disaster strikes, do you know exactly what your homeowner's insurance covers? Many homeowners assume they’re fully protected, only to find out after a fire or storm that certain damages or losses aren’t included in their policy.

For residents of Evanston, IL, where historic architecture, harsh winters, and proximity to Lake Michigan all contribute to homeownership risks, having the right insurance coverage is essential. This guide explains what homeowners insurance covers, what’s excluded, and how to customize your policy to ensure your home and belongings are fully protected.

At its core, homeowners insurance is designed to protect the physical structure of your home, ensuring that if disaster strikes, you can afford to rebuild or make necessary repairs. Most standard policies cover damage caused by:

• Fire and smoke
• Windstorms and hail (common in Evanston’s spring and summer months)
• Lightning strikes
• Falling objects, like tree branches
• Burst pipes and water damage (as long as it’s not from flooding)

For Evanston residents, it’s crucial to check if your policy covers full replacement costs. Older homes often require specialized repairs or custom materials, which can drive up rebuilding expenses. If you own a historic home in areas like the Ridge Historic District, you’ll want to ensure your policy includes replacement cost coverage rather than actual cash value, which accounts for depreciation and may leave you with a shortfall.

Your home isn’t just walls and a roof—it’s filled with furniture, electronics, clothing, and personal items that can be costly to replace. That’s where personal property coverage comes in. If your belongings are stolen, damaged, or destroyed by a covered event, your policy will help you replace them. Standard coverage includes:

• Furniture, appliances, and clothing
• Electronics like TVs, laptops, and gaming consoles
• Jewelry, art, and collectibles (often up to a certain limit)

If you own high-value items such as antique furniture, expensive watches, or rare artwork, you may need to add a rider or floater to your policy. This provides extra coverage beyond standard limits. For Evanston homeowners with custom interior design features or rare collectibles, reviewing these coverage limits is essential.

Accidents happen, and liability coverage ensures that you're financially protected if someone is injured on your property or if you accidentally damage someone else’s property.

For example:

• A guest slips on an icy sidewalk outside your home in the winter and sues for medical expenses.
• Your dog bites a neighbor while you’re out for a walk.
• A tree from your yard falls onto a neighbor’s garage, causing significant damage.

Liability coverage helps pay for medical bills, legal fees, and damages if you’re found responsible. Most standard policies include $100,000 to $500,000 in coverage, but given the higher property values in Evanston, it’s worth considering additional liability protection or an umbrella policy for added peace of mind.

Imagine your home becomes unlivable due to fire, storm damage, or other covered disasters. Where would you stay while repairs are underway? Additional Living Expenses (ALE) coverage helps pay for temporary housing and daily costs if you’re forced to relocate.

This coverage can include:

• Hotel stays or short-term rentals
• Restaurant meals if your kitchen is unusable
• Pet boarding fees
• Storage costs for your belongings during repairs

In Evanston, where housing availability can be tight, knowing your ALE coverage limits ensures that you’re not left scrambling for accommodations.

While homeowners insurance is comprehensive, some risks require separate policies. These include:

• Flooding: Standard policies don’t cover flood damage. If you live near Lake Michigan or a flood-prone area, purchasing flood insurance through FEMA or a private insurer is highly recommended.
• Earthquakes: While rare in Illinois, earthquakes aren’t covered under standard policies.
• Normal wear and tear: Insurance won’t pay for damage due to neglect, such as an aging roof that needs replacement.
• Sewer and drain backups: Heavy rains in Evanston can lead to basement flooding, but standard policies don’t cover it unless you add a sewer backup rider.

If your home is in a low-lying area or has a finished basement, investing in additional coverage for water-related damage is a smart move.

Every home is different, and customizing your homeowner's insurance ensures you have the right protection. Here are some additional coverages to consider:

• Flood Insurance: Essential for homes near Lake Michigan or low-lying areas.
• Extended Replacement Cost Coverage: Ensures you’re covered even if rebuilding costs rise due to inflation or supply chain issues.
• Sewer Backup Coverage: Protects against basement flooding caused by heavy rain or city sewer system issues.
• Home Business Coverage: If you run a business from home, your standard policy may not cover office equipment or liability related to clients visiting your home.

Before renewing your policy, work with a local insurance agent to tailor your coverage to your specific home and risk factors.

Understanding what homeowners insurance covers can help you make informed decisions about protecting your home, belongings, and financial future. Whether you live in a historic brownstone, a lakefront condo, or a single-family home near Central Street, having the right coverage in place ensures peace of mind.

If you’re considering buying or selling a home in Evanston, IL, working with a knowledgeable real estate team can help you navigate both the housing and insurance landscape. Contact Summerville Partners today for expert guidance on finding the right home and ensuring it’s properly protected.