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Ask the Home Insurance Expert

Do the contents of a house include outside items like go-karts and toys?

Yes, the contents include all of those items. Home insurance covers the structure, the contents and even landscaping up to certain limits.

Homeowners policies automatically cover household contents up to 40 percent of the amount your house is insured for. So if you insured your home for $200,000, the contents would be insured for up to $80,000. The automatic coverage pays the actual cash value of damaged, stolen, or destroyed household goods. Actual cash value is the amount it would cost to replace the item, minus depreciation.

By paying a higher premium, you can get replacement cost coverage. With replacement cost coverage, your insurance company pays to buy a new item to replace the one that was stolen or damaged. For instance, if a fire destroyed your 5-year-old couch, a replacement cost policy would provide the money to buy a brand new sofa, versus what you'd expect to pay for an old one.

Talk to your insurance agent or company to make sure you have adequate coverage. Don't rely on coverage levels mandated by bank or mortgage companies -- those limits are designed to protect the house, not necessarily your belongings.

Consider special add-ons for valuables, such as jewelry, computer equipment and other expensive possessions.

Keep in mind that standard home insurance doesn't provide coverage for earthquakes or floods, so if your go-kart floated away after torrential rains or got destroyed in an earthquake, standard home insurance wouldn't cover it. California residents can purchase earthquake coverage from the California Earthquake Authority through participating insurers.

People who live in moderate- to high-risk flood zones must purchase flood insurance to get mortgages, but flood insurance is available to people who live in low to moderate flood risk areas, too. Flood insurance is a special policy backed by the federal government sold in cooperation with local communities and private insurance companies.

For more, see home insurance basics.

Last updated: Jan. 6, 2011