HO policies or homeowners insurance policies are designed to provide help in safeguarding the homeowners’ personal and home belongings. Since they are mainly responsible in protecting their personal and home property, it is necessary for them to get an insurance policy. The main purpose is to cover any of the damages or loss of property. The truth is that they can be sued by anyone who gets involved with any accidents.
Aside from these accidents, any homeowner may be forced to temporarily leave their home or arrange an alternative accommodation if ever it gets damaged by any natural calamity. This is where insurance policies prove to be very helpful. And, the reasons above are enough for you to consider getting one.
The Basic Coverage of Homeowners Insurance
The basic policy ensures the entire property from any damage caused by top 11 factors or the so-called perils of nature. These factors include but are not limited to smoke, vandalism, lightning, fire, volcanic eruption, snow, ice, windstorm hail, theft, and riot.
This is typically called as the HO-1. It becomes less popular over the years as it does not provide protection for any damage or loss due to plumbing issues caused by freezing. The heating system issues are also other issues that are not covered by the policy.
With HO-2 that is another basic policy, it mainly covers an even wider scope. The HO-2 protects this property from any damages from the 17 factors. This is even better in offering marginal improvements over the first basic homeowners’ insurance policy.
Although it is obvious that the HO-1 and HO-2 only offer minimal coverage, there is another policy that is best for those people living in the areas. This is actually safe from earthquakes and floods. This is simply called as the HO-3.
With this policy, it further provides a lot of benefits for homeowners. This is especially for those who are sued by those who get involved into any accidents within their property. The damages on the personal and residential property are also being covered by this insurance.
The company that provides for this policy would agree compensating the price equivalent to the cost. This is also when the property is replaced. If ever personal property is damaged, the homeowner will receive the exact cash value of such property. In case you live in a flood prone area, you can always get a policy that covers the flood damages other than the HO-3 policy.
Comprehensive Form Policy
This type of policy is often called as the HO-5. This is quite similar to buying the HO-3 policy. This comes along with an endorsement for “Special Personal Property”. This will cover any of the unscheduled personal properties from any risks with exception from certain aspects. It is the main reason why it is 15% more expensive than the coverage options under HO-3.
An Insurance Policy Made for Older Homes
In this policy, the cost covered will be the actual market value of the entire property. There is nothing more and there is nothing less. It is also called as the HO-8 policy and this is considered as the modified version of the HO-1.
Regardless of what you choose, homeowners insurance will still be beneficial for all!