Home Improvement

The Different Types of Homeowners Insurance Explained

No one thinks it will ever happen to them… until it does. In 2019 alone, more than 5% of insured homes in the United States had to file home insurance claims. When the unthinkable happens, it pays to have the right protection in the form of homeowners insurance.

But, once you start researching insurance for homes, you’ll realize there are several different options available to you. We’re here to help clear it up a bit.

Keep reading to learn about the different types of homeowners insurance available so you can make the right decision for your home and your family.

HO-1 Insurance

The most basic of all the different home insurance options, HO-1 covers the structure of your home as well as appliances and certain home features like carpeting. However, it only covers those items in very specific circumstances like damage from:

  • Smoke
  • Theft
  • Fire
  • Explosions
  • Hail
  • Vandalism

Since it’s such a limited policy, you’ll likely want to purchase a more comprehensive one.

HO-2 Insurance

Unlike an HO-1 policy, HO-2 insurance covers your home and your personal belongings. Some of these policies also include liability coverage in certain circumstances. An HO-2 policy covers all of the same circumstances that an HO-1 covers, but also includes additional coverage for events like freezing pipes and falling objects.

If you go through one of these circumstances and you feel like your insurance company isn’t paying out accordingly, contact a bad faith insurance attorney for guidance.

HO-3 Insurance

Considered to be one of the most common types of homeowners insurance, an HO-3 policy covers your home and personal property, as well as medical payments and additional living expenses.

In this case, you’ll have coverage for open perils, unless your structure has a specifically excluded peril. This could include pet damage or neglect.

HO-4 Insurance

This is another name for renters insurance. It covers your personal property and some policies include coverage for additional living expenses. However, since renters don’t own the building, this policy doesn’t cover the building’s structure.

HO-5 Insurance

One of the most popular types of homeowners insurance is an HO-5 policy. This includes the most comprehensive coverage for your home and belongings in addition to living expenses and medical payments. Since it offers higher limits for valuable items as well, this is likely the policy you’ll want if you own high-value items.

It’s also an open perils policy and will include specific exclusions that are not protected.

HO-6 Insurance

If you own a condo, you’ll need an HO-6 policy. It will cover everything in your unit as well as additional living expenses and personal liability. Depending on the specifics of your policy, it may also include some dwelling coverage.

HO-7 Insurance

An HO-7 policy is specifically for manufactured or mobile homes like RVs, trailers, and modular homes. This policy covers your personal belongings, the home’s structure, medical payments, and additional living expenses unless damage comes from a specifically excluded event.

HO-8 Insurance

Finally, HO-8 insurance is for those with older homes that can’t be replaced. This includes historic landmarks and architecturally significant houses. It can also include homes that were built with materials that are no longer common.

Understanding the Different Types of Homeowners Insurance

Now that you’ve read through this guide, you should better understand the different types of homeowners insurance and which policy you need.

Looking to read more like this? Browse through our other articles today!


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