An insurance form is another name for an insurance policy, and it specifies what
perils your home and belongings are insured against. The following are descriptions
of the various insurance forms available for homeowners, renters and condominium
owners. Not all insurers use these exact terms to describe their home insurance
forms; however, the coverage provided will be similar.
The five homeowners package forms offered to owners of single family owner occupied
homes are HO-1, HO-2, HO-3, HO-3 with HO-5 and HO-8. These policy forms insure
your home and belongings against at least 11 named perils. The more perils your
policy covers, the more you will pay for the policy.
- Basic Form (HO-l) insures your property against the first 11 basic perils
shown in the chart.
- Broad Form (HO-2) covers the 17 perils listed in the chart.
- Special Form (HO-3), the most popular of all homeowner's forms, offers a
broad range of coverage. This form provides comprehensive coverage on your home
and broad named peril coverage on your contents.
- Comprehensive Form (HO-3 with HO-5) covers your home and personal property
for everything that is not specifically excluded. This policy generally provides
the broadest coverage available, but is not offered by all companies. It usually
- Modified Coverage Form (HO-8) is designed to provide package coverage to
the owner-occupants of homes that do not meet all the requirements applicable to
other homeowners forms. The HO-8 provides building and personal property coverage
slightly more restrictive than that of other homeowners forms for owner-occupants
that include a replacement cost clause. The HO-8 is particularly well-suited for
residences that have suffered extensive depreciation.
Your home may not qualify for one of the five homeowners package policies; therefore,
a company may offer you limited coverage on your house. This coverage may be Fire
and Extended Coverage. Your home and only your home would be covered for damage
due to very specific perils or losses.
If you rent an apartment or a house, you are responsible for liability coverage
and for insuring your personal possessions. Liability coverage protects renters
the same as it would if you were a homeowner.
The owner of the property is responsible for insuring the building and for obtaining
his or her own liability coverage.
- Tenants Form (HO-4), or a renter policy, insures your household contents
and personal belongings against the perils included in the home insurance Broad
Form (HO-2). (Please see chart.)
Like home insurance, it provides coverage for additional living expenses and includes
personal liability protection.
Your condominium association should purchase a policy that covers the building,
including any common walls and grounds, including liability associated with common
properties. You have a right to examine the association policy.
To protect your contents and interior walls, you may purchase Unit-Owners Form (HO-6).
An individual unit-owner policy is similar to home insurance and renters' insurance.
Optional Coverages You May Wish to Consider
- Condominium Unit-Owners Form (HO-6) will cover a unit-owner who wishes to
insure his or her property or to cover any items not insured by the association's
policy. A unit-owner policy will also pay for property damage to personal belongings,
wall, floor and ceiling coverings, and any accessories not originally installed
in the unit. It also provides personal liability protection.
- Guaranteed Replacement Cost Coverage - Guaranteed replacement cost coverage
is the most complete coverage for your home. To obtain this type of coverage, you
typically must meet specific underwriting rules and conditions of the company. This
may include increasing the amount of your insurance on a monthly, quarterly or yearly
basis to keep up with the inflation rate. Check with your insurance producer to
determine if an additional premium is required and if there are exclusions or conditions
- Inflation Guard Endorsement - If the replacement cost of your home is increasing
with inflation, your policy limits must be periodically increased to maintain your
coverage at 80% or higher. Even though the amount of homeowners insurance you carry
is at least 80% of your home replacement cost, this amount of coverage may not be
enough in the future.
To aid you in keeping coverage at an adequate level, some companies offer an "Inflation
Guard Endorsement." This endorsement will allow your insurance company to automatically
change your policy limit during the policy period. Normally, the higher premium
is not paid until the time of renewal.
Even if you have this endorsement on your policy, you should check your coverage
limits periodically to make sure you are adequately, but not excessively, insured.
Not all companies offer this endorsement, so check with your producer or company
if you are interested in purchasing it.
- Scheduled Personal Property Endorsement - This endorsement is sometimes called
a "personal article floater." A personal article floater covers possessions such
as jewelry, furs, stamps, coins, guns, computers, antiques and other items that
may exceed normal limits in your regular home insurance policy. A personal article
floater itemizes each article, gives a description of the article insured and lists
excluded perils. It often provides coverage that is broader than the coverage granted
in the home insurance policy. There is typically no deductible applied to this coverage.
- Increased Limits on Money and Securities - This endorsement increases the
coverage on money, bank notes, securities, deeds, etc.
- Secondary Residence Premises Endorsement - Homeowners coverage under this
endorsement applies to a secondary residence (example: summer home). Remember that
these secondary residences are not automatically covered by the home insurance policy
on your primary or principal residence.
- Watercraft Endorsement - Applicable to small sailboats and outboard motor
boats, this endorsement broadens personal liability and medical payments coverage
- Theft Coverage Protection Endorsement - As a result of this endorsement,
your theft protection is broadened. The contents of your motor vehicle, trailer
or watercraft are covered without proof of forcible entry. This endorsement applies
only to forms HO-1, HO-2, HO-3 and HO-4.
- Credit Card Forgery and Depositors Forgery Coverage Endorsement - Loss, theft
or unauthorized use of credit cards (with certain exceptions) is covered by this
endorsement. Also covered is the forgery of any check, draft, promissory note, etc.,
again with certain exceptions. No deductible applies to this endorsement.
- Flood Insurance - Standard home insurance policies do not cover flood damage.
Depending on where your home is located, you may qualify for flood insurance through
the National Flood Insurance Program. Some insurance companies also offer flood
insurance. Your producer or insurance company can assist you with application forms
for flood coverage. If your home is located in a flood plain, your lender should
require flood insurance. Just because your home is not in a designated flood plain
don't assume you will never incur flood damage. For more information about federal
flood insurance, contact the National Flood Insurance Program at 1-800-638-6620.
- Earthquake Insurance - Earthquake insurance is available through most insurance
companies at an additional cost. It is normally issued as an endorsement and attached
to your home insurance policy.
- Windstorm Coverage - Most home insurance policies cover damage caused by
windstorm and hail. However, in some areas of certain states, mostly coastal, this
coverage is excluded from the standard policy. For more information, ask your insurance
producer or insurance company if this peril is covered by your policy.