The main reason for home insurance policies is to protect your main dwelling, that part of your home where you actually live. Imagine dealing with a total loss due to a house fire or extensive (and expensive) damage due to a hurricane or tornado. You should ideally insure your home at 100% of its value, but at least 80% to 90% is pretty standard. Minor damage, major damage, and total replacement costs will be covered by most policies.

The second most important component of homeowners insurance is coverage for your detached structures, which may include a garage, sheds, fences, the dog house, and more. Normally, detached structures are covered at up to 10% (or some other percentage) of the coverage limit for your main dwelling. But you can customize your policy if you want additional coverage for detached structures on your property.

Whenever you get home insurance, you need to take inventory of all the appliances, furniture, electronics, and other personal property inside of your home that would be covered by the policy. If a covered event (like a storm) damages or destroys some of this property, you can be reimbursed in part or in whole, depending on your policy’s specific stipulations. This is a major benefit of this kind of insurance that is often overlooked by homeowners.