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Property Insurancel How to identify whatkinds of loss arecovered byhomeowner’sinsurance and fireinsurancel How to calculate theamounts recoverableby homeowners undercoinsurance clausesl How to describe thecoverage of marineinsuranceUnderstanding propertyinsurance will help youprotect your property atthe lowest cost.l property insurancel binderl floater policyl homeowner’sinsurancel renter’s insurancel fire insurancel coinsurancel ocean marineinsurancel inland marineinsuranceProperty InsuranceProperty insurance is a contract in which the insurer promises,for a stated premium, to pay you a sum of money if a particular pieceof real or personal property is damaged or destroyed. The policy becomeseffective as soon as the insurer accepts your application, or even soonerif a binder is issued. A binder gives you temporary protection until apolicy is issued.A floater policy is one that insures property that cannot be coveredby specific insurance because it is constantly changing in value orlocation. A personal property floater, for example, can cover a bicycle,portable stereo, or laptop computer, no matter where the items arelocated.Homeowner’sand Renter’sInsuranceMany insurance companiesoffer a combination policyknown as a homeowner’s policy.Homeowner’s insurance protectsagainst most types oflosses and liabilities related tohome ownership, includingfire, windstorm, vandalism,burglary, and injuries sufferedby other persons while on theproperty. See Figure 35.5 for amore complete listing of someof the losses covered by homeowner’sinsurance. With certainlimitations, homeowner’s policiescover your personal propertyanywhere in the world.Renter’s insurance protectsyou against loss of personalproperty, liability for a visitor’sPROPERTY INSURANCEMost private property can be insured toreduce the risk of loss. What are somekinds of protection that are covered byhomeowner’s insurance?762 Unit 7: Planning for the Future