What types of coverage are typically included in homeowners insurance?

• A. Only property damage coverage
• B. Property damage, liability, and additional living expenses
• C. Liability coverage for tenants only
• D. Fire coverage only

Answer: (B)

Homeowners insurance typically provides several types of coverage to protect the policyholder's property and assets. The correct answer includes property damage, liability, and additional living expenses.

Property damage coverage protects the physical structure of the home and personal belongings from various risks such as theft, vandalism, or natural disasters like fire and windstorms. Liability coverage is essential because it protects the homeowner against legal claims and lawsuits for injuries or damages that occur on their property. This can include incidents such as a guest getting injured while visiting or damage caused by pets. Additionally, coverage for additional living expenses comes into play when the home becomes uninhabitable due to a covered loss, providing financial support for temporary housing and related costs.

In contrast, other options do not reflect the comprehensive nature of a typical homeowners insurance policy. If only property damage coverage were included, it would leave the homeowner vulnerable to legal claims and living expense challenges after a catastrophic event. Focusing solely on fire coverage or liability for tenants is also insufficient, as they do not encompass the complete range of protections homeowners need.