What Are Different Types of Homeowners Insurance? ~ Hampton Roads Real Estate Ramblings

What Are Different Types of Homeowners Insurance?

Wednesday, May 21, 2008

Hello Hampton Roads,

When buying your first home, I’m sure that question has been asked numerous times, “What are the different types of homeowners insurance?”

I’m glad you asked!

Let’s start by defining homeowner’s insurance which is also known as hazard insurance. Homeowner’s insurance provides coverage for the property, it’s contents, loss of its use, or loss of personal possessions and can also provide liability insurance for accidents that happen at home. The cost of insurance depends on what it would cost to replace the house as well as other items covered by the insurance policy.

When a buyer purchases a home using a mortgage, the lender will require the buyer to purchase homeowner’s insurance to protect the bank’s interests.

There are basically 7 different types of standardized homeowners insurance forms and they are as follows:

  • HO-1 A limited policy offering varying degrees of coverage for items specifically mentioned in the policy. It can be an item of value like an antique or painting.
  • HO-2 Also limited policy covering specific portions of the house against damage. This coverage is a “named perils policy” in that it names the events which are covered.
  • HO-3 This is the most common policy which covers all aspects of the home, its structure, contents, and also provides liability insurance as well as protection from accidents and injury to others. This is known as an “open perils” policy and provides all risk coverage.
  • HO-4 This policy is renter’s insurance. It covers the apartment aspects and contents not covered by the blanket policy for the rental unit or complex. This policy may also provide liability coverage from accidents and injury to others (guests or passers-by).
  • HO-5 This homeowner’s policy is very similar to the HO-3 policy in that it covers the home, it’s contents, and provides for liability coverage, however, it differs in the extent of coverage is much greater in what it covers and the extent of coverage.
  • HO-6 This policy is for condominiums and it covers the gap between the master insurance policy (what the condo will cover) and what is important to the condominium owner. In addition to personal property, it also provides for liability insurance for residents and guests.
  • HO-8 This is “older home” insurance and it allows homeowner’s whose homes may have a higher replacement cost than market value, insure their home at the lower market value rate.

These are the 7 different types of homeowner’s policies. Speak to you insurance agent for more details about the type and depth of coverage you need. If you would like a referral for a great insurance agent in Virginia Beach who covers the Hampton Roads area, or if you have any other real estate needs, please let me know how I can help!


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For your real estate needs, visit my website at http://www.hamptonroadsrealestate.us/

3 Comments:

Jhon smith said...

thanks for the information...
u have really nice blog...

Jhon smith said...

thanks for sharing the valuable information...
really appretiated blog...

Liz Schuyler, Virginia Beach Real Estate Agent said...

Thank you, I really appreciate the feedback!