The insurance tree
How US insurance is organized, from the two big families down to single causes of damage. Open a branch to go one level finer.
The one split that explains most of it
- Property
- Pays for your own things when they're damaged. What's covered depends on the cause, the peril.
- Liability
- Pays when you harm someone else or their things, plus your legal defense.
- People
- Pays for health, lost income or death. Not tied to any object.
Both personal and commercial lines split the same way. Under each Property branch you'll find the perils: wind, water, fire and the rest, down to single events like a hurricane's storm surge. The verdicts there are for a standard home policy (HO-3) under personal lines, and a standard commercial property policy under commercial lines.
Personal linesInsurance for you, your household and your things.
- Read the page about personal lines
PropertyPays to repair or replace your own things after damage.
Home and dwelling policiesYour home: the building and your belongings.
- Homeowners (HO-3, HO-5, HO-2)The house you own and live in.
- Renters (HO-4)Your belongings when you rent.
- Condo (HO-6)The inside of your unit.
- Landlord (DP-1, DP-2, DP-3)A home you rent out, and the rent.
- FloodBought separately; home policies exclude it.
- EarthquakeBought separately or added on.
Auto physical damageDamage to your own car.
- CollisionYour car after a crash, whoever was at fault.
- ComprehensiveTheft, hail, flood, fire, animals and falling objects.
What can cause damage (perils)The causes a property policy covers or excludes. Verdicts are for a standard home policy (HO-3).
- Read the page about what can cause damage (perils)
WindThe most common source of big property claims in the US.
Tropical cyclonesStorms that form over warm ocean water.
- Hurricane wind Usually coveredCovered, often with a separate hurricane deductible of 1–5% of the building's insured value.
- Tropical storm wind Usually coveredCovered. The hurricane deductible may apply once a storm is named, depending on your state.
- Storm surge Usually not coveredSeawater pushed ashore by the storm counts as flood, so only a flood policy pays.
- Hurricane rainfall flooding Usually not coveredRising water from the rain is flood too. Rain that gets in through a wind-damaged roof is covered.
Severe convective stormsThunderstorms and what they bring. Most frequent in spring and summer.
- Tornado Usually coveredCovered as windstorm.
- Straight-line wind and derechos Usually coveredCovered as windstorm, whatever the wind direction.
- Hail Usually coveredCovered, often with a wind/hail deductible. Some policies exclude cosmetic dents or pay older roofs less.
- Lightning Usually coveredCovered, including electronics damaged by a lightning strike.
Winter stormsSnow, ice and cold. Nor'easters are the big coastal ones.
- Weight of snow, ice or sleet Usually coveredCovered when the weight damages the roof or makes part of the building collapse.
- Frozen and burst pipes It dependsCovered if you kept the heat on, or shut off and drained the water.
- Ice dams It dependsWater that backs up under the shingles is usually covered; fixing the roof's poor drainage isn't.
- Winter wind Usually coveredCovered as windstorm.
WaterWhere the water came from decides everything.
- Burst pipe or appliance leak Usually coveredSudden water from inside the building is covered.
- Slow leak over weeks or months Usually not coveredTreated as a maintenance problem, and so is the mold that follows.
- Sewer or drain backup It dependsOnly with a water backup coverage add-on.
Flood Usually not coveredRising water from outside. Excluded from standard property policies; covered by a separate flood policy.
- Read the page about flood
- River flooding Usually not coveredA river or creek overflowing its banks.
- Flash and surface-water flooding Usually not coveredHeavy rain the ground and drains can't absorb.
- Coastal flooding and storm surge Usually not coveredSeawater pushed inland by storms or very high tides.
- Mudflow Usually not coveredA river of liquid mud. Covered by flood policies, unlike landslides.
- Groundwater seeping in Usually not coveredWater coming up through the foundation or basement floor.
FireThe oldest and most basic covered peril.
- Building fire Usually coveredCovered, whatever started it, unless you set it on purpose.
- Wildfire Usually coveredCovered, including smoke damage. In high-risk areas, getting a policy at all can be hard.
- Smoke Usually coveredSudden smoke damage is covered; normal fireplace smoke isn't.
- Explosion Usually coveredCovered, such as a gas leak igniting.
Earth movementThe ground shifting under the building. Mostly excluded.
- Earthquake Usually not coveredNeeds separate earthquake cover. Fire caused by an earthquake is covered.
- Landslide Usually not coveredExcluded, and hard to insure anywhere.
- Sinkhole It dependsExcluded in most policies. Florida home policies must cover catastrophic ground collapse.
- Volcanic eruption Usually coveredLava, ash and blast are a named peril. The quakes it causes aren't.
Human actionsDamage caused by someone, on purpose or by accident.
- Theft and burglary Usually coveredCovered, with lower limits for valuables such as cash and jewelry.
- Vandalism It dependsCovered, unless the building has been empty for more than about 60 days.
- Riot and civil commotion Usually coveredCovered.
- Vehicle or aircraft hitting the building Usually coveredCovered.
- Damage you cause on purpose Usually not coveredNever covered.
Wear, time and living thingsSlow damage insurers treat as upkeep, not accidents.
- Wear and tear, rust, rot Usually not coveredNot insurable.
- Mold Usually not coveredUsually excluded, with a small allowance when a covered leak caused it.
- Termites, rodents and other pests Usually not coveredExcluded; a sudden collapse from hidden insect damage is an exception.
- Power surge from the utility It dependsCovered for wiring, but standard wording excludes electronic parts.
LiabilityPays when you harm someone else, and pays your lawyers.
Personal liability (Coverage E)Harm you cause at home and in daily life. Part of a home, renters or condo policy.
- Read the page about personal liability (coverage e)
- Bodily injuryA guest slips on your stairs; your dog bites someone.
- Property damageYour bathtub overflows into the unit below.
- Medical payments to othersA guest's small medical bills, whoever was at fault.
Auto liabilityHarm you cause on the road. The liability part of car insurance. Required in almost every state.
- Read the page about auto liability
- Bodily injury liabilityOther people hurt in a crash you caused.
- Property damage liabilityTheir car, fence or building.
- Uninsured motoristThe reverse: pays you when the at-fault driver can't.
- Personal umbrellaAn extra layer: adds $1 million or more on top of home and car liability.
PeoplePays for your health, income or life, not for things.
- HealthDoctor, hospital and prescription costs.
- DisabilityPart of your income if you can't work.
- LifeMoney for your family if you die.
Travel and petSmaller policies that mix the three kinds.
TravelA bundle of property, money and health cover for one trip.
- Read the page about travel
- Trip cancellation and interruptionPrepaid costs, for listed reasons only.
- Travel delayMeals and a hotel after a set number of hours.
- BaggageDelayed or lost bags, above what the airline pays.
- Emergency medical and evacuationCare while abroad.
- PetVet bills for accidents and illness.
Commercial linesInsurance for a business, its people and its work.
- Read the page about commercial lines
PropertyThe business's own buildings, equipment, stock and income.
- Commercial propertyBuildings, equipment and stock. Often part of a BOP.
- Business income and extra expenseLost income and extra costs while you recover from damage.
- Inland marineProperty that moves: tools, equipment and goods in transit.
- Commercial auto physical damageCollision and comprehensive on business vehicles.
What can cause damage (perils)The causes a property policy covers or excludes. Verdicts are for a standard commercial property policy (special form).
- Read the page about what can cause damage (perils)
WindThe most common source of big property claims in the US.
Tropical cyclonesStorms that form over warm ocean water.
- Hurricane wind Usually coveredCovered, often with a separate hurricane deductible of 1–5% of the building's insured value.
- Tropical storm wind Usually coveredCovered. The hurricane deductible may apply once a storm is named, depending on your state.
- Storm surge Usually not coveredSeawater pushed ashore by the storm counts as flood, so only a flood policy pays.
- Hurricane rainfall flooding Usually not coveredRising water from the rain is flood too. Rain that gets in through a wind-damaged roof is covered.
Severe convective stormsThunderstorms and what they bring. Most frequent in spring and summer.
- Tornado Usually coveredCovered as windstorm.
- Straight-line wind and derechos Usually coveredCovered as windstorm, whatever the wind direction.
- Hail Usually coveredCovered, often with a wind/hail deductible. Some policies exclude cosmetic dents or pay older roofs less.
- Lightning Usually coveredCovered, including electronics damaged by a lightning strike.
Winter stormsSnow, ice and cold. Nor'easters are the big coastal ones.
- Weight of snow, ice or sleet Usually coveredCovered when the weight damages the roof or makes part of the building collapse.
- Frozen and burst pipes It dependsCovered if you kept the heat on, or shut off and drained the water.
- Ice dams It dependsWater that backs up under the shingles is usually covered; fixing the roof's poor drainage isn't.
- Winter wind Usually coveredCovered as windstorm.
WaterWhere the water came from decides everything.
- Burst pipe or appliance leak Usually coveredSudden water from inside the building is covered.
- Slow leak over weeks or months Usually not coveredTreated as a maintenance problem, and so is the mold that follows.
- Sewer or drain backup It dependsOnly with a water backup coverage add-on.
Flood Usually not coveredRising water from outside. Excluded from standard property policies; covered by a separate flood policy.
- Read the page about flood
- River flooding Usually not coveredA river or creek overflowing its banks.
- Flash and surface-water flooding Usually not coveredHeavy rain the ground and drains can't absorb.
- Coastal flooding and storm surge Usually not coveredSeawater pushed inland by storms or very high tides.
- Mudflow Usually not coveredA river of liquid mud. Covered by flood policies, unlike landslides.
- Groundwater seeping in Usually not coveredWater coming up through the foundation or basement floor.
FireThe oldest and most basic covered peril.
- Building fire Usually coveredCovered, whatever started it, unless you set it on purpose.
- Wildfire Usually coveredCovered, including smoke damage. In high-risk areas, getting a policy at all can be hard.
- Smoke Usually coveredSudden smoke damage is covered; normal fireplace smoke isn't.
- Explosion Usually coveredCovered, such as a gas leak igniting.
Earth movementThe ground shifting under the building. Mostly excluded.
- Earthquake Usually not coveredNeeds separate earthquake cover. Fire caused by an earthquake is covered.
- Landslide Usually not coveredExcluded, and hard to insure anywhere.
- Sinkhole It dependsExcluded in most policies. Florida home policies must cover catastrophic ground collapse.
- Volcanic eruption Usually coveredLava, ash and blast are a named peril. The quakes it causes aren't.
Human actionsDamage caused by someone, on purpose or by accident.
- Theft and burglary Usually coveredCovered, with lower limits for valuables such as cash and jewelry.
- Vandalism It dependsCovered, unless the building has been empty for more than about 60 days.
- Riot and civil commotion Usually coveredCovered.
- Vehicle or aircraft hitting the building Usually coveredCovered.
- Damage you cause on purpose Usually not coveredNever covered.
Wear, time and living thingsSlow damage insurers treat as upkeep, not accidents.
- Wear and tear, rust, rot Usually not coveredNot insurable.
- Mold Usually not coveredUsually excluded, with a small allowance when a covered leak caused it.
- Termites, rodents and other pests Usually not coveredExcluded; a sudden collapse from hidden insect damage is an exception.
- Power surge from the utility It dependsCovered for wiring, but standard wording excludes electronic parts.
Business-only causesExtra causes that matter to businesses. Usually need an add-on.
- Equipment breakdown It dependsA compressor, boiler or server failing. Needs an equipment breakdown add-on.
- Spoilage It dependsFood or stock ruined by a power or cooling failure. Needs an add-on.
- Employee theft and fraud Usually not coveredNeeds a crime policy.
- Cyberattack Usually not coveredNeeds cyber insurance.
LiabilityClaims that the business harmed someone else.
General liabilityPhysical harm to the public, and harm through ads.
- Read the page about general liability
- Bodily injury and property damage (A)A customer slips; a worker floods a client's home.
- Products and completed workHarm from something you sold or finished.
- Personal and advertising injury (B)Libel, slander, copying an ad idea.
- Medical payments (C)A visitor's small medical bills.
- Professional liability (E&O)Money a client lost because of your advice or service.
- Management liabilityD&O for leaders' decisions; EPLI for employee claims.
- Cyber liabilityClaims after customer data is exposed.
- Commercial auto liabilityCrashes involving business vehicles.
- Commercial umbrellaAn extra layer on top of general, auto and employer's liability.
PeopleThe business's employees.
Workers' compensationRequired in nearly every state once you have employees.
- Read the page about workers' compensation
- Part 1: workers' comp benefitsMedical care and lost wages for work injuries, set by state law.
- Part 2: employer's liabilityLawsuits connected to work injuries.
- Employee benefitsGroup health, life and disability plans offered to staff.