Homeowner insurance policies differ as much as homes—they are all different. Although the basic coverage will likely be very similar, many options are available. You may have gotten a good deal on your insurance policy from an agent, but it may not give you the coverage you need. When it comes down to it, it is up to you to know what you need and how much you can afford when buying or modifying a homeowner insurance policy.
Typical Coverage
A homeowner’s policy is purchased based on the type of structure you own and the kind of coverage you want. Policies are designated by HO-1 through HO-8, except for HO-7. Each one is different and offers certain features or is for a specific type of dwelling. A HO-3 policy is the standard policy offered today to homeowners.The HO-3 policy covers potential property damage based on 16 possible “open perils.” These policies cover any type of risk except for those that are specifically mentioned in the policy. They provide coverage for events such as fire, wind, theft, lightning, smoke, vandalism, riot, vehicles, accidental discharge of water or steam, and more.
