By now, you may already have some idea of what homeowners’ insurance provides coverage for. Usually, the structure of your living space, rented or owned, but there are actually several levels of coverage to it. Ideally, you also want your personal property protected as well. It also depends on the type of home you are living in at the same time. There is a whole system of different types of homeowners’ insurance for each homeowner and their respective living spaces.
What Homeowners’ Insurance is
We’ll firstly cover what homeowners’ insurance generally covers. While the homeowners’ policies we are about to go over are different in name and policyholders, they all still function the same way. Here is what homeowners’ insurance and some of its add-ons cover:
Personal property coverage – First and foremost, homeowners’ insurance exclusively provides insurance for your personal property kept within your home. Appliances, furniture, clothes, decorations, and electronics are all essential parts of your home. The most common causes of damage in the home are fire and criminal damage like theft. Homeowners’ insurance includes financial protection from these hazards, but only for belongings in your home –not the structure itself.
House and attached structures – Dwelling coverage, as it is also called, is the homeowners’ coverage add-on that covers your home’s structure along with any attached structures on the property like a garage. Driveways, porches, and fences are also insured with this coverage. Even swimming pools can be covered by dwelling insurance.
Personal liability coverage – Another essential part of insurance is liability coverage. If a guest is injured in your home while visiting, you can be liable for any medical treatments and legal fees. This is where personal liability coverage comes in.
Damages That Isn’t Covered by Any Homeowners’ Insurance
As a footnote, homeowners’ insurance typically requires more specialized coverage for certain damages and hazards that can befall a home. These include flooding, earthquakes, mold, insect infestation, natural decay, and terrorist attacks.
The Different Homeowners’ Insurance Types
Homeowners’ insurance comes in eight different types of policies. Each one is designed for a different type of homeowner with different coverage amounts and kinds. The best part is that they are all numbered and easily identifiable:
HO-1 policy – This is the most basic homeowners’ policy on the list, naturally being the first. This coverage specializes in natural disaster coverage, including hail damages along with the typical fire hazards. Other inclement weather conditions that cause damage are also insured. This is great since it covers the structure of your home with its dwelling coverage. Personal property coverage may also be a part of it. However, liability coverage is left out of HO-1.
HO-2 policy – Also known as peril policy, HO-2 includes in addition to a variety of weather and criminal threats, natural disasters are also covered. The policy may be specific with what period it does and doesn’t cover. Again, your personal property isn’t included. This policy is often the road less traveled by homeowners.
HO-3 policy – This is the most common homeowners’ policy due to its broad coverage. It extends coverage to some of the most common criminal and weather damages like theft and storms. Personal property protection is also included in this policy, along with structural protection, making it ideal for the average homeowner.
HO-4 policy – This homeowners’ policy is more so designed for renters. It’s important for renters to have personal property insurance rather than dwelling coverage because it is the landlord who is often responsible for it. An HO-4 policy does just this.
HO-5 policy – The best way to think of an HO-5 policy is an upgraded version of the HO-3 with several of the coverages enhanced with larger limits. Those in high-risk areas when it comes to weather or crime will benefit the most from this homeowners’ policy.
HO-6 policy – Based on its name as condo insurance, you can guess the kind of homeowners HO-6 is for. It also benefits several housemates living together. This includes personal property and dwelling convergence.
HO-7 policy – HO-7 has all the coverages as HO-3, except it is applied to trailers and mobile homes. Mobile homes typically won’t be able to be insured with any other type of homeowners’ policy.
HO-8 policy – This policy is also like an HO-3, except it is reserved for older homes, usually those 40 years and older. Personal property and dwelling coverage are included against all criminal and weather-related damages.