What are the different types of dwelling insurance?

Houses and Insurance: Various Styles

Dwelling policies aim to protect the dwellings of all kinds. They usually include property coverage and liability coverage, but the risks they protect against are written differently. They have different names.

HO-1 Basic coverage

HO-1 is a basic form policy. It is called a hazardous cover. Its words and coverages include fire or smoke, explosions, lightning, hail and windstorms, theft/malicious mischief, vandalism, vehicle damage, aircraft damage, riots and civil commotion, volcanic eruption. It does not include in-house liability coverage or coverage for personal items. Property is also covered by ACV or actual cash value. That's the dwelling's depreciated value, not replacement cost value.

HO-2 Broad coverage.

This form covers liability and personal property plus other items, and the list of hazards is broader than the bare form policy. However, it is still a so-called hazard policy as opposed to a comprehensive HO-3.

HO-3 Special.

This is the most often written policy for homeowners. It covers the dwelling on a particular form basis with the cost of replacement (not market value). There is no list of hazards, only a small list of exclusions such as nuclear hazard, earthquake, flood, hurricane, mold, etc. Personal property is covered as peril, including unattached structures. Typically, usage loss is covered, which pays for living expenses after a covered loss when owners move to temporary quarters.

Different insurance carriers may need additions to the original coverage protections, so it is vital to review what is covered and not. Decide what matters in your situation.

Renters HO-4

HO-4 renters policies protect a renter who only needs coverage for content and liability. It typically also covers usage loss.

All-risk HO-5

HO-5 comprehensive all risks. HO-3 policy with better content coverage. It's written on higher-end homes and is more expensive than HO-3, but it protects more fully. It's worth your time to protect your content better.

Townhouse coverage HO-6

HO-6 (or townhouse) coverage. Since the owner of a condo does not own the structure, this form includes, in addition to content and liability and usage loss, interior structures (cabinets, floors, fixtures). It also has a loss assessment coverage, which would cover the assessment that the homeowner's association could levy if a structure loss to a covered peril occurred. Coverage for interior structures and loss of use is variable, and the policy owner should ensure adequate coverage for each contingency type.

Mobile home coverage HO-7.

This type of policy resembles an HO-3 policy but is written for mobile homes, so it may not cover separate structures. As before, all of the above policies vary depending on the insurance company that writes the coverage. As with Auto Insurance, it's critical to ask questions and compare what's best for you.

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