Homeowners insurance (often abbreviated in the real estate industry as HOI), is the type of property insurance that covers detached homes. Homeowners insurance combines various personal insurance protections, which can include losses occurring to one's home, its contents, loss of its use (additional living expenses), or loss of other personal possessions. It may also include a liability policy for accidents that may happen in the home or at the hands of the homeowner within the home's grounds.
Homeowners insurance is designed for owner-occupied residences. This means that the policy requires that at least one of the named policyholders occupies the home.
Homeowners insurance is multiple-line protection because it includes both property and liability coverage, with an indivisible premium (single premium is paid for all risks).
HOI premiums often depend on what it would cost to replace your home and which additional riders (additional items to be insured) are attached to the policy. It is important to keep in mind that claims due to floods or wind (amongst other standard exclusions like termites) is excluded. Flood insurance and wind insurance have specific insurance policies.
Homeowners insurance should be regularly adjusted to reflect current replacement cost, usually through the application of an inflation factor or a cost index.