New Mexico Real Estate Practice Exam 2025 - Free Real Estate License Practice Questions and Study Guide

Homeowners insurance is specifically designed to protect homeowners from a variety of risks associated with property damage. This type of insurance typically covers losses or damages to the home itself, as well as the assets within the home, due to events such as fire, theft, vandalism, and certain natural disasters. Homeowners insurance also often includes liability protection, which can cover legal expenses if someone is injured on the property.

In contrast, liability insurance generally covers injuries to others or damage to their property that you may cause, but it does not provide coverage for damage to your own property. Renters insurance protects tenants rather than homeowners, offering coverage for personal belongings and liability without covering the physical structure of the residence. Title insurance, on the other hand, protects against losses related to defects in ownership titles, such as undiscovered liens or ownership disputes, rather than property damage itself. Therefore, homeowners insurance is the correct choice for protecting against losses due to property damage.