Home insurance types are simply various forms of protection. This does not apply to limits, but rather the policy itself. Insurance companies classify them like this to ensure they can compare policies clearly.
The policy type depends on various factors. This might include whether you have a standalone home or if you rent. Some forms cover co-ops. Some policies can also restrict the type of coverage you receive under the plan. This may help reduce coverages you do not need, therefore lowering your costs overall.
What Does HO-1 Cover?
This is one of the most basic forms of home insurance. It is generally coverage for standalone homes, which includes most single-family properties. HO-1 has limitations on its coverage that you should know about before buying it.
The coverage provided by HO-1 usually includes the following protections:
- Fire and lightning
- Riots and civil commotion
- Windstorms and hail
- Vandalism and malicious mischief
- Glass that is a component of the home itself
- Volcanic eruptions
The policy does not cover any type of unnamed peril. For example, if something other than the above list occurs, then the policy does not offer coverage. Also, keep in mind that some HO-1 policies limit or do not cover personal belongings in the home. This type of coverage is not commonly used, however. The lack of contents protection often makes it limitedly beneficial to most people.
Other Options to Keep in Mind
There are numerous other options including HO-2, HO-3, HO-4, HO-5, and HO-6. It is important to compare these. For example, HO-2 covers the same coverages as HO-1 as well as several others. It also covers personal property in the home. HO-3 is a more common option with special insurance protections from unnamed risks. However, it often includes exclusions to things like flooding and earthquakes.
As you compare the options you have for home insurance, it is quite important to learn the details of the policy. The more you do, the more likely you are to have coverage that fits all of your risks.