When you suppose home-owner’s insurance coverage is boring, take coronary heart! We promise to make this text as entertaining as attainable. Examine all eight kinds of owners insurance coverage under, (#8 is the very best!)
Widespread House owner Insurance coverage Coverages
Most owners are conversant in the trade normal HO-3 coverage. It sometimes consists of protection to rebuild a house after a complete loss from fireplace, and covers some contents, outbuildings, fences and the like.
Such a home-owner coverage additionally consists of useful legal responsibility protection, which may assist pay for lawsuits related to accidents somebody may incur in your property, or harm to their property.
Nevertheless, the world of home-owner’s insurance coverage is altering quickly. Wildfire dangers, civil unrest, tropical storms and local weather change subjects are altering how insurers work and which kinds of dangers they are going to cowl.
Right now, our useful crew of licensed insurance coverage brokers at Einsurance.com explains every thing you want to learn about several types of owners insurance coverage. We’ll cowl the eight kinds of HO insurance policies (which you really want to know should you work in insurance coverage) and different dwelling insurance coverage choices.
Let’s begin with a radical overview of assorted kinds of home-owner’s insurance coverage.
The 8 Sorts of House owner’s Insurance coverage: HO-1 by HO-8
There are eight kinds of home-owner’s (HO) insurance policies, and the one you want depends upon the protection you want and the kind of dwelling you personal.
HO-1
These insurance policies are very restricted, and most main insurers don’t promote them. HO-1 insurance policies solely cowl the construction of a house. They don’t embrace legal responsibility protection, as an illustration, nor will they assist substitute the contents of a house after a loss.
HO-1 insurance policies are very uncommon in 2025. Nevertheless, between inflation and challenges confronted by insurers and shoppers, we are able to think about a future the place HO-1 polices develop into common once more. In spite of everything, they would supply sufficient protection to appease a mortgagee (the lienholder on a mortgage contract.)
HO-2
Solely barely extra frequent than HO-1, HO-2 insurance policies are barely much less restricted. Once more, most main insurers don’t promote these insurance policies. They provide slightly extra protection than a “naked bones” HO-1.
Particularly, HO-2 home-owner’s insurance coverage insurance policies pays to switch your belongings after a coated loss. They could or could not embrace legal responsibility protection, different constructions protection, particles removing and so forth.
HO-3
Amongst all the house insurance coverage protection sorts, the HO-3 is the present trade normal for single-family properties.
When you have a house owner’s insurance coverage coverage, or should you’re searching for dwelling insurance coverage quotes, that is the product you’re procuring. We are going to, subsequently, spend slightly additional time explaining how they work.
HO-3 insurance coverage is obtainable by all the key insurance coverage corporations, resembling
- Farmers Insurance coverage
- Progressive
- GEICO
- Allstate
- Traveler’s Insurance coverage
- State Farm
- The Hartford
Any HO-3 coverage will embrace protection to rebuild a house after a coated loss. We’re speaking about fireplace, lighting, wind, hail, civil unrest, falling tree limbs and so forth.
How are HO-3 Coverage Limits Figured? What do they Cowl?
A licensed insurance coverage agent will use a components (sq. toes x present substitute prices) to find out the possible prices to rebuild your private home after a complete loss and base your coverage limits on that quantity. This primary quantity is known as Protection A.
These insurance policies additionally embrace:
- Legal responsibility protection
- Contents protection
- Particles removing protection
- Value of residing protection, which pays on your housing when you rebuild
- Protection for outbuildings, different constructions and fences
- Ordinance and legislation protection (which pays additional to rebuild your private home as much as present codes)
Now, every of those insurance coverage protection sorts is figured as a share of your Protection A. Your particles removing protection, as an illustration, is often 10% of your Protection A. If your private home is insured for $300,000, the insurer will present one other $30,000 to pay for particles removing after your private home burns down.
As you store for dwelling insurance coverage insurance policies, do not forget that the coverages provided will fluctuate primarily based on the valuation utilized by the insurance coverage agent to the house.
HO-4: Renter’s Insurance coverage
HO-4 insurance policies, additionally known as “renter’s insurance coverage,” are designed to guard tenants (however not landlords, immediately.) They exist to cowl a tenant’s belongings, however not the construction of a home or house.
Primarily, the tenant and insurer agree {that a} tenant’s belongings are price a specific amount, and the insurer pays to switch them. We see renter insurance policies starting from $25,000 to $100,000 and extra, relying on the scale of the rental dwelling, the variety of folks residing there, and the prices of their belongings.
HO-4 insurance policies cowl a tenant’s:
- Clothes
- Furnishings
- Small home equipment
- Cosmetics
- Toys
- Some electronics
They usually supply restricted protection for issues like jewellery, art work, computer systems and money.
Renter’s insurance coverage doesn’t cowl the owner’s property immediately, so carpets or main home equipment that are a part of the rental unit aren’t coated.
Nonetheless, many landlords now compel tenants to keep up an HO-4/renter’s coverage as a part of the rental settlement/lease. That’s as a result of this sort of home-owner insurance coverage coverage may be very reasonably priced, and may one thing occur to a tenant’s belongings, they are often changed. A glad tenant is much less more likely to attempt to sue a landlord to switch belongings after an incident that damages their property.
HO-5
Consider an HO-5 coverage as the large brother of an HO-3. That is the second hottest sort of home-owner insurance coverage coverage, and they’re written as “open peril” insurance policies.
Very like an HO-3, this coverage will present legal responsibility protection, contents protection, different constructions protection and particles removing. And it’ll cowl them for all perils besides these particularly excluded in writing.
Perils particularly excluded within the contract are often:
- Floods
- Earthquake
- Volcano or lava stream
- And in some areas, tornadoes, windstorms, tropical storms and hurricanes
Each insurer has totally different guidelines for each state and each area. When you purchase an HO-5, it’s important that you just learn your coverage paperwork very fastidiously, and know which perils are excluded. You could want to purchase further insurance coverage, like a flood coverage, or different riders if you need earthquake protection.
These insurance policies are costlier than HO-3s, and with the altering insurance coverage setting, we are able to think about them turning into out of date as a consequence of pricing.
HO-6: Rental Insurance coverage
Condominium insurance coverage covers every thing in a apartment however doesn’t cowl outbuildings. Rental house owners get the advantages of contents protection, and legal responsibility protection, however this coverage is not going to pay to rebuild an enormous apartment advanced if it burns down.
HO-7: For Cell & Manufactured Properties
In relation to kinds of owners insurance coverage, cell and manufactured properties are handled very equally by insurers, and solely a handful of insurers work with them.
For the sake of this dialogue, let’s agree that cell properties are transportable housing items. We’re speaking about “trailers, trailer properties, cell properties and cell park properties.”
A manufactured dwelling, which isn’t a “trailer” however is constructed and delivered in 2 or 3 items, is often thought-about a cell dwelling for the sake of insurance coverage.
At first look, cell/manufactured dwelling insurance coverage insurance policies embrace many of the identical coverages as a normal HO-3. We’re speaking about fireplace protection, contents protection, legal responsibility protection and the like.
Nevertheless, not like a framed, everlasting dwelling, cell properties depreciate shortly. A trailer dwelling that offered for $25,000 in 1958 is probably going price only some thousand {dollars} as we speak, because of depreciation. (Whereas a framed dwelling in-built 1958 for $25,000 is likely to be price $250,000 as we speak.)
And that’s the place cell dwelling insurance coverage will get sophisticated.
HO-7 Alternative Value vs. Precise Money Worth Insurance policies
An HO-7 coverage is written with substitute price protection, very similar to a standard dwelling insurance coverage coverage.
In brief, if your private home have been to burn down, your HO-7 coverage limits needs to be sufficient to switch this dwelling with a model new one in all related fashion, sq. footage and facilities.
Different kinds of cell/manufactured dwelling insurance coverage are written as precise money worth insurance policies. In different phrases, if your private home burns down with this kind of protection, the insurer will solely pay the depreciated worth. When you’re residing in an older cell, just like the 1958 mannequin we talked about above, that will solely be a number of thousand {dollars}.
These precise money worth insurance policies are way more reasonably priced than HO-7s, they usually’re very priceless for people residing in older trailers. They could or could not have the ability to substitute that 1958 trailer, however no less than they’ve the funds to discover a new residing state of affairs and substitute a few of their belongings after a loss.
HO-8: Specialty Dwelling Insurance coverage
HO-8 home-owner insurance coverage insurance policies are uncommon in most markets, however your insurance coverage agent will let you know should you want one. These insurance policies exist to guard older, very high-end properties which might price way more to switch as we speak than once they have been constructed.
And of all the house insurance coverage protection sorts, that is probably the most enjoyable to discover.
Property Insurance coverage for Historic Mansions, Specialty Property & Plantation Properties
As an instance, let’s think about you’re a tech billionaire. You’re on the lookout for a brand new main residence within the mansion district of San Francisco. The mansion you like will price $300 million, boasts unimaginable views, 18 bedrooms, a marble mausoleum within the again, and a carriage home.
This dwelling was in-built 1870 by some railroad mogul. It has all of the gilded-age particulars one can think about.
Touring the house, you’re keen on the:
- Teakwood grand staircases
- Marble grand entryway
- Monumental, unique crystal chandeliers
- Huge ballroom, with inlaid ebony wooden ground
- And real elephant ivory doorknobs
You particularly love to make use of the brassy vintage elevators to get to the topmost flooring.
Is that this dwelling price $300 million? Most likely, to the correct particular person. If it burned to the bottom, may you rebuild it? No.
Lots of the supplies used to create this historic dwelling are now not obtainable, or solely obtainable at unimaginable costs. Take into consideration all that uncommon wooden and actual marble, and the expert employees that did all that customized work by hand.
Even probably the most minor particulars are irreplaceable. The sale of these historic ivory doorknobs is forbidden within the US, in truth. As a tech billionaire, you may most likely pay somebody to supply them, journey overseas to buy them, and semi-smuggle them into the nation on one in all your non-public jets. However that’s actually NOT coated by your home-owner insurance coverage coverage.
In the end, most shoppers won’t ever have the necessity for an HO-8 coverage. Nonetheless, as insurance coverage brokers, we’ve got probably the most enjoyable fascinated by them.
TLDR; (Too Lengthy, Didn’t Learn) Key Takeaways
Most US shoppers are searching for HO-3 insurance policies. They’re the most well-liked sort of dwelling insurance coverage protection for a single-family dwelling, and the trade normal within the US. Different frequent dwelling insurance policies embrace renter’s insurance coverage and cell dwelling insurance coverage.
The common shopper doesn’t must know the variations between all eight kinds of owners insurance coverage insurance policies. Your licensed insurance coverage agent will current you with choices proper on your dwelling.
At all times learn quotes and coverage paperwork fastidiously. Your coverage will clarify precisely what is roofed, what’s excluded, and the way a lot protection applies to every level.
For cell and manufactured properties, substitute price and precise money worth insurance policies are very totally different. Alternative price insurance policies ought to pay sufficient to utterly substitute your private home with a model new one in all related measurement and worth. Precise money worth cell dwelling insurance policies will solely pay a depreciated worth, and that quantity will be very small for older trailers.
Attempt Our Helpful On-line Quoting Device for Dwelling Insurance coverage
At Einsurance.com, we work laborious to match insurers and shoppers. Whether or not you personal a cell dwelling or a historic mansion, we may also help you discover the correct dwelling insurance coverage coverage on the proper worth.
Simply enter your data on our web site, and we’ll have insurers contacting you with quotes straight away.
Additionally, we invite you to spend extra time on our insurance coverage journal to study extra about insurance coverage subjects for shoppers. We cowl every thing from automobile insurance coverage to medical health insurance, life insurance coverage, and extra.