Learn what insurance can do, what choices you may see, and how to compare them in plain language.
First, how does insurance work?
You pay a set amount to keep a policy. That payment is called a premium. If something covered by the policy happens, the insurance company may help pay, up to the policy rules and limits. You may have to pay part of the cost yourself.
PremiumThe price you pay to keep the policy.
DeductibleThe amount you pay first for some covered losses.
LimitThe most the policy may pay for a type of loss.
ExclusionSomething the policy says it will not cover.
A policy is a written agreement. It does not cover every problem. The details in the policy matter.
Choose a topic to learn about common options. You can use this guide whether or not you work with CMIR.
Homeowners insurance
This can help pay for certain damage to your home and things, and some claims if someone says you caused harm. The policy lists what is covered and what is not.
Common parts
Home: repair or rebuild the house after a covered loss.
Belongings: help repair or replace covered things you own.
Liability: help if you are legally responsible for harm to someone else.
Living costs: help with extra costs if a covered loss makes the home hard to live in.
Choices to understand
Replacement cost: based on the cost to repair or replace, subject to policy terms.
Actual cash value: may subtract for age and wear.
Flood and earthquake damage often need separate coverage.
Different parts of the policy may have different limits and deductibles.
Compare these
How much could the policy pay to rebuild? How are your things valued? What deductibles, limits, and exclusions apply? What damage needs a separate policy?
Questions to ask
Would this limit be enough to rebuild my home?
What would I pay first if I had a claim?
Is flood damage covered by this policy?
Auto insurance
Auto insurance can help pay after a crash or other covered event. Some coverage pays for harm to other people. Other coverage may help with your car or your injuries.
Common choices
Liability: helps pay for injury or damage you cause to others, up to its limits.
Collision: may help repair your car after a crash.
Comprehensive: may help for some other events, such as theft, fire, or hail.
Uninsured motorist: may help if a driver who hits you has no insurance or not enough.
Other options
Depending on your state and policy, you may see medical payments, personal injury protection, rental car, roadside help, or glass coverage. Rules and names can vary by state.
Compare these
Who is listed as a driver? What limits apply? Which deductibles do you choose? Would the policy help repair your car? What does your lender require?
Questions to ask
What would this policy pay if I hurt someone?
What would I pay to fix my own car?
Which choices are required by my state or lender?
Life insurance
Life insurance pays money to the people or groups named in the policy if the insured person dies while the policy rules are met.
Term life
Term covers a set time, such as 10 or 20 years. It may fit a need that lasts for a set time. If the term ends, coverage may stop or renewal may cost more.
Permanent or cash value life
Some policies are designed to last longer and may build cash value. The cost, guarantees, and rules depend on the policy. Some values can change and are not guaranteed.
Compare these
How long does coverage last? Can the price change? What is guaranteed? What happens if you stop paying, borrow from cash value, or need to change the policy?
Questions to ask
Who would need money if I died?
How long might they need help?
Which benefits and costs are guaranteed in writing?
Health insurance
Health insurance helps pay for some medical care. You usually pay each month, and you may also pay when you get care.
Know these costs
Premium: what you pay each month to keep the plan.
Deductible: what you pay for some care before the plan starts sharing costs.
Copay: a set amount for some care.
Coinsurance: your share as a percent.
Out-of-pocket maximum: a yearly limit for covered care under the plan rules.
Plan choices
Some plans use a smaller group of doctors and hospitals. Others may let you use more providers at a higher cost. HMO, PPO, EPO, and POS are plan types. Their rules differ.
Compare these
Check your doctors, hospitals, and medicines. Compare the monthly price plus what you might pay when you use care. Look at the plan rules and covered services.
Questions to ask
Are my doctors and medicines in the plan?
What may I pay in a year if I use little care? What if I use more?
Do I need a referral to see some doctors?
Business insurance
Business insurance can help a business pay for certain losses. The right choices depend on what the business does, what it owns, and who it serves.
Common choices
General liability: may help with some claims of injury or property damage to others.
Business property: may help protect buildings, tools, stock, and equipment.
Professional liability: may help with some claims about a service or advice.
Commercial auto: may cover vehicles used for business.
Other choices
A business owners policy may bundle some common coverages. Workers’ compensation, product liability, cyber, and business income coverage may matter for some businesses. Required coverage depends on laws, contracts, and location.
Compare these
What work is covered? What property and locations are listed? What limits, deductibles, exclusions, and contract requirements apply?
Questions to ask
What could stop my business or cost more than I can pay?
What does my lease or customer contract require?
Which rules should I confirm with my state?
Renters insurance
Your landlord’s policy usually protects the building, not the things you own. Renters insurance may help protect your belongings and cover some liability claims.
Common parts
Belongings: may help repair or replace covered things you own.
Liability: may help if you are legally responsible for harm to someone else.
Extra living costs: may help if a covered event makes your home hard to live in.
Choices to understand
Belongings may be valued by replacement cost or actual cash value. Some valuable items have small limits. Flood damage may need separate coverage.
Compare these
Would the limit replace your belongings? What deductible applies? Are special items covered? What causes of loss are excluded?
Questions to ask
What would it cost to replace my things?
How does the policy value older items?
Would I need separate coverage for flood or valuable items?
Rental property insurance
A home rented to others may need different coverage from a home you live in. Tell the insurer how the property is used.
Common parts
Building: may help with covered damage to the rental home.
Owner’s items: may cover things you leave there, if listed and covered.
Liability: may help with some claims involving injury or damage.
Lost rent: may help replace rent after some covered losses, subject to policy rules.
Details that matter
Long-term rental, short-term rental, vacancy, and owner occupancy can have different rules. A tenant’s belongings usually need the tenant’s own policy.
Compare these
Does the policy match how the property is used? What happens during vacancy? What property, liability, and lost-rent limits apply?
Questions to ask
What changes must I report if the rental use changes?
Are short-term rentals treated differently?
What happens if the home is empty between tenants?
Flood insurance
A regular home policy often does not cover flood damage. Flood coverage is usually a separate policy. Flood risk can exist in many places.
What to look at
Does the policy cover the building, your belongings, or both?
What are the limits and deductibles?
How does the policy define flood?
What items or parts of a building are not covered?
Policy choices
Some coverage is offered through the National Flood Insurance Program. Private flood policies may also be available. Rules, limits, prices, and waiting periods can differ.
Compare these
Look at what is covered, how losses are valued, the deductible, exclusions, waiting period, and when coverage starts.
Questions to ask
Would this cover the building, belongings, or both?
When would coverage begin?
What would I pay first after a flood?
Umbrella insurance
An umbrella policy can add more liability coverage above some home, auto, or renters policies. It does not fix every gap.
What it may do
If a covered claim is bigger than the limit on an underlying policy, an umbrella policy may help pay the extra amount, up to its own limit and rules. It may also help with some legal defense costs.
What it usually does not do
It is not a repair policy for your own home or car. It does not cover every claim. Exclusions and rules still apply.
Compare these
What policies must you keep? What limits must they have? What claims are included or excluded? What is the umbrella limit?
Questions to ask
Which policies and people does it cover?
What must my home or auto limits be?
What claim would still not be covered?
Specialty property
Some homes, projects, and property need a closer look. Examples include manufactured homes, homes being built, and unusual or high-value property.
Options you may hear about
Manufactured home: coverage designed around the home and how it is set up.
Builders risk: coverage for some property or materials during a building project.
Scheduled items: extra coverage for certain valuable belongings may be available.
Details that matter
Share how the property is used, where it is, who works on it, what is stored there, and when the project starts and ends.
Compare these
What property is listed? Which stages or uses are covered? What limits, deductibles, exclusions, and reporting rules apply?
Questions to ask
Does the policy match how the property is used today?
What changes must I report during a project?
What items or events are not covered?
Want to explore options for your situation?
CMIR can help you explore insurance options that may be available to you.
Requesting a quote is optional—you can use this guide on your own.
This guide is for general learning. It is not a quote, a policy, or a recommendation for your situation. Policies differ. Read the policy and ask a licensed professional about details that affect you. Coverage, cost, eligibility, and availability vary.