Your first thought when hearing this question may be, “Well, it better. That’s why I have homeowners insurance!” And you’re right. The fast answer is yes, most standard homeowners insurance policies cover fire damage. But what exactly does that mean? What, specifically, does your policy protect inside and around your home? Up to how much will your insurance company pay if you lose your home and everything in it? We intend to answer these deeper questions today to help you better understand how your policy protects your most valued assets.
What does fire insurance cover?
According to the National Fire Protection Agency, U.S. fire departments respond to an average of 354,400 home structure fires per year. While none of us want to entertain the thought of our precious homes catching fire, we need to make sure we’re prepared and adequately protected—just in case.
A standard homeowners insurance policy will cover smoke and fire damage to your home and belongings. Insurance companies will generally cover damage caused by fires that were started accidentally, by wildfires, and by natural events that lead to fire—like lightning strikes or earthquakes.
Insurance does NOT cover damage caused by arson, gross negligence, or acts of war. A standard policy also won’t cover damage to your home if the fire started after your home was left vacant for more than 30 consecutive days; in this case, you would need vacant homeowners insurance for adequate protection.
What is your coverage limit?
Are you confident that your coverage limit is high enough to insure the value of your home and personal assets so you aren’t left paying thousands of dollars out of pocket if something happens? An estimated 60 percent of homes in the United States are underinsured. To determine what your coverage limit should be, consider each of the following categories:
- Dwelling coverage (covers the cost to rebuild your home, also called replacement cost, includes detached structures like sheds, garages, and fences)
- Personal property coverage (covers the value of your personal belongings)
- Liability protection (covers you if someone is injured on your property at any time)
- Additional living expenses coverage (optional, reimbursement for added costs while your home is being repaired)
Read our blog post, “How Much Homeowners Insurance Coverage Do I Need?” to learn more about each of these important categories, as well as how to calculate the amount of coverage you need in each area.
While it’s important that you’re not underinsured, it’s also unnecessary to over-insure your home and personal property. Consider these examples:
Let’s say the value of your home and property together is $350,000. Your coverage limit is $250,000, and your deductible is $1,000. If your home is destroyed, your insurance company might pay you $249,000 (your coverage limit minus your deductible). In turn, you’d be responsible for replacing about $100,000 in losses yourself.
If your coverage limit was $400,000, which abundantly covers your home and property, your insurance company would only reimburse you up to $349,000—equal to the replacement value of your home and personal property minus your deductible. A $350,000 coverage limit would have been sufficient.
When should you consider standalone fire insurance?
“Dwelling fire coverage” costs less than standard homeowners insurance, but it’s also much less comprehensive. It will cover your home in case of a fire, but unlike standard homeowners insurance, it won’t cover other common perils like theft, liability, or damage caused by ice, snow, or frozen pipes.
While we generally wouldn’t recommend solely purchasing fire-only insurance for your primary home, there are a few situations where it might be wise to add it to your homeowners insurance policy.
- You have a secondary or vacation home that is left vacant for part of the year, standalone fire insurance may be a viable option, since these types of homes are sometimes difficult to insure.
- You have an older home.
- Your home has a claims history that makes it very expensive to insure with a standard policy.
- You live in an area susceptible to wildfire. Supplementing your standard policy with extra fire insurance could grant you extra protection and peace of mind.
Especially around the holidays, when more people are packed into our homes and extravagant meals are being prepared, it’s important to be extra careful while cooking, decorating, and keeping everyone warm and cozy. To keep your abode safe and sound all year long, follow the expert tips Firefighter Kerri Przyblyski lays out for us in this short video on home fire safety.
Get a Quote
If you’re not sure if your home and belongings would be fully covered if there’s a fire, Coverage Direct would love to help you find answers. You can contact us directly or request a free homeowners insurance quote online. Our independent insurance advisors will work directly with you. We’ll impartially shop multiple insurance companies to help you find the best policy for the best price.
Call, text, email, or instant message our team any time. We’re here to serve you!
- “Does Homeowners Insurance Cover Fire Damage?” Allstate
- “Does Homeowners Insurance Cover Fire Damage? Do I Need Separate Fire Insurance?” ValuePenguin
- “What Does a Homeowner Fire Policy Cover?” Insurance.com
- “What Is Covered by Fire Insurance?” The Balance