There’s a lot of confusion about hazard insurance and homeowners insurance. Some people think they’re the same, while others believe that they offer different types of coverage. So, what’s the truth? Are hazard and homeowners insurance the same thing? And if not, what kinds of protection do they offer? Let’s take a closer look.

What are the Name Perils & Open Perils Coverages?

If you’re under a Named Perils Policy, your Hazard Insurance will cover any damages done by the sixteen perils specified in your Homeowner’s Insurance. 

However, if you have an Open Perils Policy, it would only cover damages caused by anything other than the perils listed in your policy.

Named perils

  1. Fire or lightning
  2. Windstorm and hail
  3. Explosion
  4. Riot or civil commotion
  5. Damage caused by aircraft
  6. Damage caused by vehicles
  7. Smoke
  8. Volcanic eruption
  9. Vandalism and malicious mischief
  10. Theft
  11. Falling objects
  12. Weight of snow, ice, or sleet
  13. Accidental discharge/overflow of water
  14. Sudden tearing/cracking of appliances
  15. Freezing
  16. Power surge

Open perils

  1. Earth movement
  2. Ordinance of law
  3. Certain types of water damage
  4. Power failure
  5. Neglect
  6. War
  7. Nuclear hazard
  8. Intentional loss
  9. Government action
  10. Dog bite liability for certain breeds
  11. Home-based businesses
  12. Pest damage and removal

Hazard Insurance vs. Home Insurance

Your mortgage lender will require a list of papers before you can close. Proof of your hazard insurance policy is one requirement that needs to be submitted before we finalize the deal. This document protects your home – and our investment – against many types of disasters, including fire, windstorms, and vandalism.


Homeowners insurance and hazard insurance are the same, though most people don’t know it. Hazard Insurance protects what you own inside your home, while Homeowners Insurance protects all the parts of your home itself.

Tip: Mortgage lenders often require hazard insurance – not homeowner’s insurance- because they’re only interested in your house and its contents. They neglect to tell you that this isn’t a different type of insurance, but simply an add-on feature of regular homeowner’s policies.

How Much Does Hazard Insurance Usually Cost?

According to, the average homeowner’s insurance cost in 2022 is $1,393 per year, based on $250,000 in dwelling coverage. This cost has increased 6% from last year. 

Is Hazard Insurance Required?

Qualifying for a mortgage generally means having at least some residential property insurance coverage; most lenders will require this. If you live in an area with multiple natural disasters (tornadoes, hurricanes), the lender might need even more coverage depending on the risks present around your home.