Posted by the author on August 30th, 2007
When shopping for Homeowner insurance, cost is not the only factor you should consider. Choosing the proper type and proper level of protection of Homeowner insurance is critical as well. You also need to know if special provisions are included and if these special provisions will provide coverage for your valuables including jewelry, computer, and other personal belongings.
In addition, you absolutely need to check if your property will need additional coverage against such catastrophes as earthquakes, floods, windstorms, fires, etc. This is one area most homeowners assume their Homeowner insurance will cover. However, most homeowners insurance policies do not.
Below is a list of basic Homeowner insurance policy types. Before talking with an insurance agent, become familiar with these types:
HO-1 Homeowner Insurance Policy: This type of Homeowner insurance policy provides basic protection for homeowners. The coverage offered by an HO-1 Homeowner insurance policy includes the house and possessions against 11 different perils.
HO-2 Homeowner Insurance Policy: Also known as broad homeowners’ policy, an HO-2 policy covers the house and its contents against 17 perils. HO-2 Homeowner insurance policy has premiums running about 5% to 10% more than an HO-1 policy.
HO-3 Homeowner Insurance Policy: Also called Special Homeowner Insurance Policy, HO-3 Homeowner insurance policy covers all perils except those that were specifically excluded in the contract. The cost for an HO-3 Homeowner insurance policy is 10% to 15% more than an HO-1 policy.
HO-4 Homeowner Insurance Policy: An HO-4 policy is specifically targeted to rental property owners. Covering 17 stated perils, HO-4 Homeowner insurance policy includes liability coverage but does not insure the dwelling itself.
HO-5 Homeowner Insurance Policy: This type of Homeowner insurance policy covers almost all damages except those caused by floods, earthquakes and wars. HO-5 Homeowner insurance policy is also known as extensive homeowners’ policy.
HO-6 Homeowner Insurance Policy: HO-6 Homeowner insurance policy is available for owners of condominiums or co-ops. An HO-6 policy provides coverage against perils state in the HO-1 policy. The difference is that HO-6 Homeowner policy only pays for repair costs or actual cash value. Replacement cost may be covered also but it will make the policy costly.
Financial, General, Home | No Comments »