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Basic Types of Home Insurance
Home insurance comes in several standard packages, each with several add-ons available.
To get the right home insurance policy, you have to choose the right types of coverage and the right amount of coverage. Picking the perfect home insurance for you starts with assessment. Look at what risks there are to your home, the value of your assets and possessions, and—if you want to save money—what you can afford to lose.
Every standard policy comes with a certain amount of property coverage and liability coverage. Property coverage will cover the costs of fixing damage to your home, if the cause of that damage is covered. Liability coverage is meant to make sure you don't have to pay the sky-high legal costs should somebody sue you because of an incident that took place on or involving your property.
HO-1
This is the most basic home insurance coverage. It covers you if there is fire or lightening damage.
HO-2
Add to the lightening and fire damage any lost or damaged property as a result of storms, hail, smoke damage, broken glass, fire, vandalism, theft, foul play, riot, or civil commotion. HO-2, also called “broad coverage”, will also pay for the removal of your property from danger should any of these scenarios come up.
HO-2 even includes coverage for building collapse, plumbing problems as a result of freezing or overheating, heating damage, air conditioning (AC) damage, objects falling from the sky, and weight of snow, ice, or sleet damage.
HO-3
The most popular home insurance policy, HO-3, or “special” homeowners insurance, protects you against every peril aside from those written out of the policy.
HO-4
The same as HO-2, but designed for renters or tenants. It includes provisions for living expenses and medical payments.
HO-6
This policy is for condominium unit owners. Most condos are insured by an association policy for the entire complex. HO-6 is designed to cover whichever objects the policyholder wants coverage for that are not already covered by the association policy. It includes liability protection.
HO-8
Older homes have special needs. HO-8 is designed to meet those needs. Older homes often do not allow for a replacement policy. HO-8 can give you a modified replacement policy. Rather than using the original building materials and designs, more current building practices will be used.
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