Home Owners Forms Compared

Basic Form Perils

• Basic Form Perils
• Fire or Lightning
• Internal explosion
• Windstorm or Hail
• Aircraft
• Riot or Civil Commotion
• Vehicles
• Vandalism
• Volcanic Action
• Explosion
• Smoke
• Theft (automatic without an endorsement)
• FLI
• WHARV
• VEST
• Fire
• Wind
• Volcanic Action
• Lightning
• Hail
• Explosion
• Internal Explosion
• Aircraft
• Smoke
• Riot and Civil
• Commotion
• Theft
• Vehicles & Vandalism

Broad Form (HO–2)

• This form provides named perils coverage for the dwelling (Coverage A), other structures (Coverage B), and personal property (Coverage C). The 16 named perils are:
• Fire or lightning
• Windstorm or hail
• Explosion
• Riot or civil commotion
• Aircraft
• Vehicles
• Smoke
• Vandalism or malicious mischief
• Theft – Automatic without an endorsement
• Falling objects
• Weight of ice, snow, or sleet
• Accidental discharge or overflow of water or steam
• Sudden and accidental tearing apart, cracking, burning, or bulging
• Freezing
• Sudden and accidental damage from artificially generated electrical current
• Volcanic eruption. Losses under Coverages A and B are valued on a replacement cost basis
• Although coverage for personal property (Coverage C) is provided on the same named perils basis as the dwelling and other structures are, losses are valued on an actual cash value (ACV) basis.
• This form does not cover loss to a fence, driveway or walk caused by a vehicle owned or operated by the insured.

HO–3 (Special Form)

• In the Special Form (HO–3), the dwelling and others structures (Coverages A and B) are insured on an open perils basis, meaning all perils are insured if they aren’t specifically excluded in the policy. Losses to the dwelling and other structures are valued on a replacement value basis just as they are in the HO–2
• The Special Form (HO–3) specifically excludes the following causes of loss under Coverage A and B:
• Collapse, except as provided by Other Coverages.
• Freezing of household appliances or a plumbing, heating, air conditioning, or automatic fire protective system unless the insured has taken reasonable care to maintain heat in the building or shut off the water supply and drained the appliances and systems of water.
• Freezing, thawing, pressure or weight of water or ice on patios, fences, swimming pools, foundations, piers, docks, retaining walls.
• Theft in or to a dwelling under construction, including construction-related materials and supplies.
• Vandalism and malicious mischief, including ensuing loss, if the dwelling has been vacant for more than 60 consecutive days immediately before the loss.
• Mold, fungus, or wet rot unless resulting from accidental discharge or overflow of water or steam that is hidden from view.
• Wear and tear, marring, deterioration, mechanical breakdown, latent defect, inherent vice, smog, rust, corrosion, dry rot.
• Wear and tear, marring, deterioration, mechanical breakdown, latent defect, inherent vice, smog, rust, corrosion, dry rot.
• Smoke from agricultural smudging or industrial operations.
• Pollution including discharge, dispersal, seepage, migration, or release of smoke, vapor, fumes, acids, or other chemicals unless such discharge is caused by a Coverage C Peril Insured Against.
• Settling, cracking, bulging, or expansion of foundation, walls, floors, pavements, patios.
• Birds, vermin, rodents or insects.
• Animals owned or kept by an insured.
• Personal property (Coverage C) is insured on a named perils basis that includes the same 16 named perils in the Broad Form (HO–2). Coverage C losses are valued on an actual cash value basis. It Includes losses to a fence, driveway or walk caused by a vehicle owned or operated by the insured.
• The burden of proof for losses to the dwelling and other structures falls to the insurer because coverage is provided on an open perils basis. On the other hand, the burden of proof for losses to personal property falls to the insured to show which of the 16 named perils caused the loss.

Contents Broad Form (HO–4)

• Contents Broad Form (HO–4)
• The Contents Broad Form is also known as the renter’s or tenant homeowners policy. It doesn’t provide any coverage for the dwelling or other structures because it’s designed to insure those who are tenants. The HO–4 insures personal property under Coverage C against loss from the 16 named broad form perils found in the HO–2 and HO–3 forms. Personal property losses are valued on an actual cash value basis, as they are on the HO–2 and HO–3 forms.

Comprehensive Form (HO–5)

• Comprehensive Form (HO–5)
• The Comprehensive Form provides the broadest coverage of any of the homeowners forms. Coverages A - Dwelling, Coverage B - Other Structures, and Coverage C - Personal Property provide insurance on an open perils basis.
• Losses to the dwelling and other structures are valued on a replacement cost basis, losses to personal property are valued on an actual cash value basis.
• Note: This form is the Deluxe Package. It is the most costly and provides the most coverage.

Unit-Owners Form (HO–6)

• Unit-Owners Form (HO–6)
• The Unit-owners Form provides named perils coverage to the owner of a condominium or cooperative unit under Coverage A - Dwelling and Coverage C - Personal Property. Coverage B does not appear in this form; however, if the owners of condominiums or cooperative units wish to insure other structures, the value of other structures may be included in the Coverage A limit of insurance.
• The form insures real property (building and building items) for which the insured is responsible under the bylaws of the condominium association or cooperative corporation. It also insures personal property of the insured while anywhere in the world.

Modified Form (HO–8) (Basic Form – Named Perils)

• Modified Form (HO–8) (Basic Form – Named Perils)
• The Modified Coverage Form is used to insure older homes when the replacement and market values of the dwelling are disproportionate or if a moral hazard would be created if insurance were written at 100% of replacement cost. An example of dwelling that would be insured under this coverage form is an old 3-story Victorian home in which the insured lives on the first two floors. If the dwelling were destroyed in a loss, the insured would not want to restore or replace it exactly as it was before the loss. Instead of insuring the dwelling for its replacement value of $1,200,000, the insured would insure it for a much lower amount of insurance.
• The limit of insurance chosen should represent the functional replacement value of the dwelling, which is the cost to replace damaged property with property that will perform the same function and efficiency even if it isn’t of like kind and quality.