Hazard Insurance

DEFINITION of 'Hazard Insurance'

Insurance that protects a property owner against damage caused by fires, severe storms, earthquakes or other natural events. As long as the specific event is covered within the policy, the property owner will receive compensation to cover the cost of any damage incurred. Typically, the property owner will be required to pay for a year's worth of premiums at the time of closing, but this will depend on the exact details of the policy.

BREAKING DOWN 'Hazard Insurance'

A typical property or homeowners' insurance policy usually won't cover all events that could do damage to your property. Some events will definitely be excluded from homeowners' insurance in high-risk areas. For example, Florida is prone to hurricanes and is, therefore, considered high risk. If the homeowner lives in a high-risk area, he or she may need a separate policy - such as a flood insurance policy.

RELATED TERMS
  1. Fire Insurance

    Insurance that is used to cover damage to a property caused by ...
  2. Contractors' All Risks (CAR) Insurance

    An insurance policy that provides coverage for both damage to ...
  3. Betterment Insurance

    Betterment insurance refers to insurance coverage that a tenant ...
  4. Water Damage Insurance

    A type of protection provided in most homeowners insurance policies ...
  5. Consequential Loss

    The amount of loss incurred as a result of being unable to use ...
  6. Flood Insurance

    A financial instrument that protects real property owners from ...
Related Articles
  1. Home & Auto

    The Importance Of Property Insurance

    Property insurance is important, but there's a lot you need to learn in order to get the proper coverage.
  2. Home & Auto

    Intro To Insurance: Property And Casualty Insurance

    By Cathy ParetoProperty and casualty insurance is insurance that protects against property losses to your business, home or car and/or against legal liability that may result from injury or damage ...
  3. Home & Auto

    What Is And Isn't Covered By Homeowners Insurance

    Understanding what your insurance covers can be confusing. Learn what almost all insurance policies have in common.
  4. Entrepreneurship

    Insurance Coverage: A Business Necessity

    Don't go to work without this policy in place - especially if your work is in your home.
  5. Insurance

    Homeowner’s Insurance Gaps to Watch Out For

    Wind and flood damage. Sewer backups. Sinkholes. What coverage are you missing that could cost you a bundle in repairs?
  6. Insurance

    7 Reasons You Have a Love-Hate Relationship With Home Insurance

    What is covered in a policy can vary widely by company, so you’d better know what to look for when shopping for home insurance.
  7. Insurance

    Insurance Tips For Homeowners

    Use these simple ideas to save money and get better coverage for your house.
  8. Home & Auto

    The Beginner's Guide To Homeowners' Insurance

    Discover everything new homeowners need to know before they sign on the dotted line.
  9. Insurance

    Find The Best Homeowners' Insurance

    Don't wait for the next Hurricane Sandy to find out if your homeowners' insurance really protects you. Test your insurance savvy now and get what you need.
  10. Home & Auto

    Making Sure Your Jewelry Is Insured

    Homeowners insurance only covers so much - find out how to make sure your jewelry is covered for theft, loss and damage.
RELATED FAQS
  1. What's the difference between renter's insurance and homeowner's insurance?

    Renters insurance and homeowners insurance offer similar benefits for occupants and homeowners, but in different ways and ... Read Answer >>
  2. Does renters insurance cover water damage?

    Learn how renters insurance provides personal property coverage for items damaged by water only if the water is the result ... Read Answer >>
  3. What is the average return on total revenue for the insurance sector?

    Learn about the three main segments of the insurance industry, and find out what the average return on revenues is for the ... Read Answer >>
  4. What are some examples of industries that practice price discrimination?

    Understand the various types of insurance coverage offered in the insurance marketplace, and learn why each policy should ... Read Answer >>
  5. How does the 80% rule for home insurance work, and how do capital improvements affect ...

    The 80% rule refers to the fact that most insurance companies will not fully cover the cost of damage to a house due to the ... Read Answer >>
  6. Is homeowners' insurance required by law?

    Learn why it is always wise to protect your home with insurance even if it is not required. Understand how high-deductible ... Read Answer >>
Hot Definitions
  1. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  2. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  3. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  4. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  5. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  6. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
Trading Center