New Mexico Home & Renters Insurance FAQ

New Mexico law does not require homeowners insurance. But if you have a mortgage, your lender will almost always require it until the loan is paid off, and they may require specific coverage amounts.

Even if your home is paid off, homeowners insurance protects what is usually your biggest investment.

A standard homeowners policy usually includes:

• Dwelling: the structure of your home
• Other structures: detached garages, sheds, and fences
• Personal property: your furniture, clothes, electronics, and other belongings
• Loss of use: extra living costs if you can't live at home during repairs after a covered loss
• Personal liability: if someone is hurt on your property or you accidentally damage someone else's property
• Medical payments: small medical bills for guests hurt at your home

What is covered, and for which events, depends on your policy.

No. Standard homeowners and renters policies do not cover flood damage. Flood coverage is a separate policy, available through the National Flood Insurance Program (NFIP) and some private insurance companies.

Flash floods and monsoon storms happen across New Mexico, including outside official flood zones. NFIP policies usually have a 30-day waiting period before coverage starts, so don't wait for storm season to buy one.

Fire, including wildfire, is usually a covered event on a standard homeowners policy. In higher-risk areas, some insurance companies may limit coverage, charge more, or require steps like clearing brush around your home.

If you live near forests or open land, review your dwelling coverage to make sure it would cover the cost to rebuild today.

Hail is usually a covered event on a standard homeowners policy. Some policies have a separate wind and hail deductible, often a percentage of your dwelling coverage instead of a flat dollar amount. Some also limit how an older roof is paid for.

Check your declarations page or ask your agent which deductible applies to hail on your policy.

Replacement cost pays to repair or replace damaged property with new items of similar kind and quality, without subtracting for age or wear.

Actual cash value pays what the item was worth at the time of the loss, which means depreciation is subtracted. A 10-year-old roof or TV is worth much less than a new one.

Replacement cost coverage usually costs more, but it can make a big difference after a claim.

New Mexico law does not require renters insurance, but many landlords require it in the lease.

Your landlord's insurance covers the building, not your belongings. Renters insurance covers your personal property, your liability if someone is hurt in your unit or you damage someone else's property, and extra living costs if you have to move out after a covered loss.

Usually not, unless your roommate is named on your policy. Many insurance companies recommend that each roommate get their own policy so each person's belongings and liability are covered separately.

Not usually. A standard homeowners policy is written for the home you live in. A second home, cabin, or vacation home usually needs its own policy, and a home you rent to tenants usually needs a landlord or dwelling fire policy.

Short-term rentals, like Airbnb or VRBO, can also need special coverage. Tell your agent how the property is used so the right policy is in place.

A deductible is the amount you pay out of pocket on a claim before insurance pays the rest.

Example: a covered loss costs $8,000 to repair and your deductible is $1,000. You pay $1,000 and insurance pays $7,000. Some policies have a different deductible for wind and hail, often a percentage of your dwelling coverage.

Standard homeowners policies usually exclude earth movement, which includes earthquakes, sinkholes, and settling or shifting soil. Some insurance companies offer earthquake coverage as an add-on or separate policy.

Gradual wear, settling, and maintenance problems are generally not covered either.

Many insurance companies offer a discount when you buy home and auto insurance from them together. As an independent agency, Rio Grande Insurance can compare bundled and separate options across multiple insurance companies and show you which way saves more.

1. Make sure everyone is safe and prevent more damage if you can, like covering a broken window.
2. Take photos and video of all damage before cleanup.
3. Make a list of damaged items, and keep receipts for any emergency repairs or extra living costs.
4. Contact your insurance company or your agent as soon as possible.

If you are a Rio Grande Insurance client, call your agent and we will help you through the process with your insurance company.

An umbrella policy adds extra liability protection on top of your home and auto insurance. It helps if a lawsuit or claim is bigger than your regular policy limits, like a serious injury on your property.

It is worth considering if you own a home, have savings or other assets to protect, or have things like a pool, trampoline, or dog.