Hazard Insurance

AAA

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.

INVESTOPEDIA EXPLAINS '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. Vandalism Endorsement

    An optional type of coverage that can be added to a basic hazard ...
  2. Property Insurance

    A policy that provides financial reimbursement to the owner or ...
  3. Workers' Compensation Coverage ...

    Insurance that protects employees under state laws, and provides ...
  4. Against All Risks - AAR

    An insurance policy that provides coverage against all types ...
  5. Flood Insurance

    A financial instrument that protects real property owners from ...
  6. Catastrophe Insurance

    Insurance to protect businesses and residences against natural ...
Related Articles
  1. Insurance Tips For Homeowners
    Insurance

    Insurance Tips For Homeowners

  2. Understanding Your Insurance Contract
    Insurance

    Understanding Your Insurance Contract

  3. 10 Hurdles To Closing On A New Home
    Insurance

    10 Hurdles To Closing On A New Home

  4. How An Insurance Company Determines ...
    Home & Auto

    How An Insurance Company Determines ...

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center