What’s so confusing about insuring your home?
Confusion about insurance topics and specifics may prevent some homeowners from buying the right amount of coverage. This kind of disconnect can and does result in under-insured homes in areas that may need that protection more than anywhere else.
Owning a home today isn’t as simple as it might have been for previous generations of homeowners. The responsibility of understanding all the details of a policy and how those elements will impact a family in times of disaster is significant. The attention to detail required of any homeowner can feel overwhelming or confusing to many, especially those new to home ownership or insurance shopping.
Over 65% of the surveyed U.S. homeowners from a recent Goosehead Insurance poll admitted to lacking a full understanding of what their home insurance policies actually covered.
Pulling in data from The Zebra’s 2026 Consumer Survey, we can find greater insight into the specifics of what homeowners in general and first-time homeowners find to be the most confusing, or difficult to understand.
The homeowners audience at large experienced the most difficulty making decisions around the ‘edges’ of their home insurance coverage: What is excluded? (33%) and What additional coverage do I need to add to my existing policy? (31%). These questions were most frequently cited as confusing.
When the focus is tightened to first-time homeowners, understanding of the amount of coverage needed and how that relates to the value of the property (37%) and the calculation of deductibles (36%) show up as the biggest concerns. Navigating the claims process (33%) and the calculation of premiums (33%) also surface as worrisome for the less-experienced subset of the polled group.
Disconnect points for homeowners:
For all homeowners surveyed: | For first-time home owners: |
Exclusions, 33% | Coverage limits, 37% |
Additional coverage, 31% | Deductibles, 36% |
Premium calculation, 30% | Claims process, 33% |
Coverage limits, 27% | Premium calculation, 33% |
Claims process, 19% | Additional coverages, 31% |
Deductibles, 18% | Exclusions, 30% |
Source: The Zebra, 2026 Consumer Survey of ~1500 US Homeowners
What practices can homeowners adopt to make insurance decisions less stressful?
An easy way for homeowners to reduce confusion and stress around home insurance decisions is to maintain a good relationship with their local home insurance agent. The value of this channel of communication is worth more than the amount of time involved, in most cases.
Keep this list of questions in mind when making a decision about your home insurance coverage, and ask your agent every one as needed to gain complete clarity on the insurance policy you’re considering.
-What is my deductible for this peril?
-Is this policy for replacement cost (RCV) or actual cash value (ACV)?
-What if my repair costs go above my policy limit during repairs?
Additionally it’s a useful practice to request a copy of your current insurance policy’s declarations page before undertaking any changes in coverage or making a claim on an existing policy.
What are the homeowner’s biggest trouble spots?
The parts that potential homeowners fear or worry about the most – expensive home maintenance or repairs or water damage – are items that are less likely to be covered by standard indemnity home insurance. This adds to the confusion of getting the right kind of home insurance or the right amount of coverage to protect yourself.
So, knowing what is and isn’t covered by their current coverage, and how they can get what they’re missing.
Coverage Limits
Coverage limits are another source of stress for many homeowners. They may be unclear or how this amount is calculated, where the limit is recorded, or the question of whether or not their policy’s limit is high enough to cover the damage their home may experience.
Coverage limits will vary with a number of factors, including the insured’s location, their insurance risk history, state laws, and any related high-risk behaviors that may exist.
Deductibles
Based on The Zebra’s 2026 data, 43% of homeowners surveyed admitted they didn't understand how percentage deductibles are calculated and applied in real life.
Exclusions
The simplicity of this topic is at odds with the amount of stress and confusion it presents to a significant group of homeowners. To avoid the circumstance of a policyholder discovering an exclusion only when they attempt to file a claim, the responsibility falls to their agent to keep their customers informed on the specifics of what is excluded from their coverage.
How homeowners plan to seek advice from new sources
Less than half of homeowners surveyed reported plans to use LLM or AI tools, including ChatGPT or Google Gemini, to gain a better understanding of their current insurance coverage, and to seek out other insurance options that may be available.
If we take a closer look at the uses that homeowners have planned for AI tools, some trends appear. The most popular idea, mentioned by 54% of homeowners, was to use AI tools to check their insurance costs against other options, determining whether or not they’re paying what they see as a fair price.
Just under half of the survey group mentioned their plans to use AI tools for comparison against other insurance policies and different insurance carriers altogether. The same percentage of homeowners in the group planned to also explore additional insurance options beyond the types they were already carrying.
A final smaller group of 40% intended to dig deeper into their current home insurance coverage and use AI tools to better understand the details and limitations of the coverage they were already paying for.
Despite the frequency of confusion over many aspects of home insurance coverage, these numbers indicate that there is a consistent desire for a more complete understanding of how insurance works, what the differences between types are, and how to make the most of the coverage that someone is already paying for.
Questions to help homeowners answer that can easily improve their insurance-buying experience:
- When is there a deductible? Deductibles are used for most types of indemnity insurance, but are less commonly used for parametric or hybrid types of insurance.
- How are deductibles calculated? Most insurance deductibles are a flat-rate sum which must be paid in full when a claim is made. Some specific types of insurance policy most often come with a percentage deductible, which is calculated as a percentage amount of the total insured value of the property.
- Can I get help covering my deductible? A supplementary insurance product can be used to give assistance to the policyholder in covering a high deductible for flood or wind/hail insurance or a similar service.
- Can I make it lower somehow? One way to find a lower deductible is to agree to a higher premium. Though this will mean more money spent on insurance on a monthly basis, it can make your life easier when you eventually need to file a claim.
A take-away checklist
Keep these steps in mind to repeat annually or before any changes in home financing.
Terms to know to simplify home insurance
CLUE Report - The CLUE is a database of insurance claims details maintained by LexisNexis that insurers use to measure the risk associated with policyholders and properties they insure.
Declarations page - This is sometimes called a “dec page” and is the section of an insurance policy that lists what property is included, which parts are excluded, and the perils for which they are covered.
Dwelling coverage (A-F) - Homeowners insurance covers the ‘dwelling’, meaning the building where you live, but there are six types of home insurance that cover other aspects of the property you call home.
A: Dwelling, meaning the structure’s walls, roof, and foundation.
B: Other structures, including sheds, garages, fences, and gazebos.
C: Personal property, including your belongings kept in the home.
D: Loss of use/Additional Living Expenses, in case your home becomes uninhabitable
E: Personal liability, covering lawsuits for injury or damage that’s your fault.
F: Medical payments, covering minor medical costs for guests injured on your property.
Named storms - Hurricanes, tropical storms, and typhoons that are recognized and assigned a name by NOAA are excluded from many roof insurance policies.
Non-renewal - Insurance carriers may choose not to renew your policy due to a variety of factors, but frequency of claims made is a likely cause for this form of polite cancellation.
With this checklist and list of terms in mind, homeowners of any demographic can be better equipped to make informed decisions on their home insurance needs, avoiding confusion or anxiety that might feel like part of the deal to other customers.
Sources:
Meyer, Susan. “Home Insurance Remains Confusing for Most Homeowners”, The Zebra, May 07, 2026, https://www.thezebra.com/resources/home/home-insurance-remains-confusing/
“Homeowner anxiety report: Balancing the stress and rewards of homeownership”, Hippo, May 12, 2026, https://www.hippo.com/blog/homeowner-anxiety-report-2026
“Hippo Housepower Report: Homeowners Gain Ground, Face New Challenges in 2026”, Hippo, Jan. 15, 2026, https://www.hippo.com/blog/housepower-report-2026
“Goosehead Insurance Survey Reveals Two-Thirds of Americans Don’t Know What their Home Insurance Covers”, Goosehead Insurance, Dec. 01, 2022, https://ir.gooseheadinsurance.com/news-releases/news-release-details/goosehead-insurance-survey-reveals-two-thirds-americans-dont
Gray is the Senior Content Specialist at Sola Insurance, working with the Sales and Marketing teams to provide helpful, valuable content for homeowners and agents. Gray has worked previously in finance, logistics, and advertising.
