The dwelling and other structures on the premises are protected on an all risks basis up to the policy limits. All risks means that unless the policy specifically excludes the manner in which your home is damaged or destroyed, there is coverage. The policy limit for the dwelling is set by the policy owner at the time the insurance is purchased.
Personal property is covered on a named perils basis. Named perils means that you have coverage only when your property is damaged or destroyed by events specifically described in the policy. The policy limit on the personal property coverage is usually between 50% and 70% of the limit on the structure at no additional cost. You may purchase more at additional cost if you can demonstrate your coverable possessions exceed these percentages.
Loss of Use and provides for the cost of living somewhere else while your home is being rebuilt. The limits for this coverage are equal to 20% of the policy limit on the dwelling.
The coverage limit on personal liability is determined by the policy owner at the time the policy is issued. The coverage limit on medical payments to others is usually set at $1,000 per injured person, although higher limits can be purchased.