A standard homeowner's insurance policy includes four essential types of coverage. They include:

1. Coverage for the structure of your home
Dwelling coverage pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disaster listed in your policy. This part of your policy will not pay for damage caused by a flood, earthquake or routine wear and tear.

2. Coverage for your personal belongings
Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other insured disaster. Expensive items like jewelry, furs and silverware are covered, but there are usually dollar limits if they are stolen. Generally, you are covered for between $1,000 to $2,000 for all of your jewelry and furs. You may want to consider adding an endorsement to your policy to protect more expensive items.

3. Liability protection
Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by your pets. The liability portion of your policy pays for both the cost of defending you in court and any court awards. It covers up to the limit of your policy. You are also covered not just in your home, but anywhere.

4. Additional living expenses
Additional living expenses pays the additional costs of living away from home if you can't live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your home is being rebuilt or repaired.