Homeowner’s Insurance
Homeowners insurance (HOI) is insurance protection for private homes. It combines various forms of coverage including losses or damage to homes, private possessions, the contents of the house as well as any liability arising out of accidents in the house. It also requires that one of the named insured persons occupy the house. In the US, mortgage lenders will almost always require this coverage as a condition of the loan so that the collateral is fully protected.
The most common forms of homeowners insurance are as follows:
Basic form policy (HO1). This is the basic policy that provides protection against 11 listed perils. The perils normally include fire, theft, damage from vehicles and so on and personal liability is included as well. Exclusions normally include floods and earthquakes…
Broad form policy (HO2). This is a more extensive policy that covers six additional perils as well as the 11 covered in HO1. This is another named perils policy where perils not specifically included are excluded.
Special form policy (HO3). This is the policy that is typically taken out by single family home owners and offers the most comprehensive coverage. Around 80 percent of the homeowner’s insurance policies in the US fall into this category. This is an “all risk policy” with named exclusions that is to say that anything that is not specifically excluded is included.
Renter’s policy (HO4). This is intended for people who rent houses and covers personal possessions against the same risks as the policies above.
HO5 is called the premium policy covering still more additional risks while HO6 is a condominium policy for condominium owners.HO8 is modified coverage for old houses where the replacement cost far exceeds the market value.