The Basics of Homeowners Insurance

Homeowners insurance policies typically cover the home and its contents, as well as liability for injuries to others or property damage. Policies are generally structured in two parts – Part I pertains to the dwelling and personal property coverage, while Part II addresses liability coverage. The following are the three standard types of coverage on Part I of a typical homeowners policy:

The basic form (HO-1) covers the house, its contents, shrubs, trees, and other outside structures such as a tool shed or garage, and it insures the same against ten major hazards such as fire and theft. Note: Some states have withdrawn it from use because it offers such limited coverage.

The broad form (HO-2) adds seven more hazards common enough to consider: hot water system leaks, plumbing, heating, air conditioning, freezing pipes, faulty electric wiring, falling objects, weight of ice, snow or sleet, or collapse of the building.

The special form (HO-3) is the most common type of coverage, and it provides more complete and extensive protection to the house, its contents, and appurtenant structures, excluding only specific disasters such as floods

-Robert Catalano.