Homeowner Special Form Property and Contents (HO-5) or (HO3 w/HO-15)

The Homeowners insurance is a policy that "packages' together coverage for the dwelling building, personal possessions, (other than automobile and certain specifically excluded items) and personal liability of the homeowner. A policy may also be written to provide package protection for apartment dwellers, renters of dwellings and condominium and townhouse unit owners. Scheduled personal property endorsement or separate personal articles floater policy is frequently needed additional protection to cover valuable articles on a scheduled "risks of direct physical loss" basis for their full value. Endorsements to the policy can add coverage for water backup, earthquake, to name a few. Discounts are available for alarm systems, new homes, auto-home with the same company, sprinklers. The discounts offered by companies differ but can reduce the cost of homeowners insurance significantly. Below are the coverages afforded under most homeowners insurance policies. Coverage amounts may vary from company to company and the policy must be consulted for exact amounts.



COVERAGE A-DWELLING—this portion of the policy protects the residence premises and attached structures. Coverage extends to materials or supplies that are located on or next to the residence. However, the material must be meant for constructing or modifying the residence. A dwelling may be a one, two or three family house, a townhouse or row house or a condo. There is a special coverage form for mobile homes. Land is not covered. This coverage may be described as the main building or home covered by the policy. Attached structures mentioned above might include carport breezeway or attached garage. It is very important to properly insure the residence for the correct amount. Most companies require that a home be insurance for 100% of replacement cost. This amount is different than market value or even the builders value of construction. The replacement cost at the time of loss should be an ample amount to cover any increase in the cost of labor and materials. Often in areas where hurricanes or tornados cause extensive damage the cost of both materials and labor increase significantly after such a loss.

COVERAGE B-OTHER STRUCTURES—other structures on the insured premises are protected under this coverage part if they are separated from the dwelling by a clear space. No coverage is provided for such structures if they are used in whole or in part for business. An example would be a shed that is used to store office fixtures or materials from your business. However, a home owner may rent a detached garage to another as long as that party uses it as a private garage. Sheds are an example of a building that would be covered by this part of the homeowners policy. Other types of other structures that would be covered by this section are gazebos, picnic shelters, swimming pools and guest houses. The basic policy provides a "built-in" additional 10% of Coverage A (the dwelling) for these structures. For example, if a home is insured for $ 100,000.00 (Coverage A) other structures (Coverage B) would be afforded $ 10,000.00 by the policy. It is also possible to increase the 10% by endorsement for an additional charge. Many companies will permit the other structures to be specifically insured by endorsement for a defined amount for an additional premium. Special care should be taken by the homeowner to inform their insurance agent as they add additional structures to their property so these buildings are properly insured.


COVERAGE C-PERSONAL PROPERTY—under this coverage part, personal property owned or used by an insured is covered anywhere in the world. Protection may be extended to cover the property of others, a guest or a residence employee if that property is at the residence premises occupied by an insured. This coverage applies to your belongs at your residence premise and y our personal property anywhere in the world, for example when you are traveling. It is very wise for the homeowner to have an inventory of personal property items. This inventory should be updated every few years to include items added to your household. Generally, a "built-in" additional amount of coverage of at least 50% of Coverage A for your personal property if provided by the policy. An example would be if your home is insured for $ 100,000.00 for Coverage A the policy would provide an additional amount of at least $ 50,000.00 for your personal property. Many companies increase the percentage of Coverage A available for personal property to 60% 80% or even higher. You may request a higher amount for an additional premium. Your personal property can be covered for either the Actual Cash Value (depreciated value) or for Replacement Cost for a loss under this section of the policy. The policy allows for replacement of property with new items of "like kind and quality" if the Replacement Cost provision applies.


INTERNAL LIMITS FOR CERTAIN PROPERTY - There is a $ 200 limit on money, bank notes, bullion, gold, silver, platinum, coins and medals. A $250 LIMIT applies to property away from the premises used at any time, in any way for business. A higher limit of $1,000 limit applies for securities, letters of credit, notes, manuscripts, deeds, accounts, stamps, passports, tickets, watercraft including trailers and furnishings. Theft of jewelry watches and furs also has limit of $1000. For theft of firearms there is a $2,000 limit. Finally, a $2,500 limit applies to theft of silverware, silver-plated ware, gold ware, gold-plated ware, pewter ware including flatware, hollow-ware, tea sets, trays, and trophies made of or including silver, gold or pewter. Theft of property from your residence used at any time or in any manner for any business purpose is limited to $ 2,500.

SOME PROPERTY NOT COVERED (Excluded) OVERAGE C-PERSONAL PROPERTY—Coverage does not apply for certain items that are specifically insured in this policy or another policy. Animals, birds or fish, motor vehicles and motorized land conveyances (including their equipment and accessories), aircraft and parts, property of roomers, boarders or tenants, property in an apartment regularly rented to others, property rented to others off the residence premises, business data, and credit cards or fund transfer cards are also excluded from coverage. However, the policy does provide coverage for vehicles used to service the residence or that are designed for assisting the handicapped. if the Replacement Cost provision applies.


COVERAGE D-LOSS OF USE COVERAGE (Temporary Living Expense) - If a covered loss makes that part of the residence premises unfit for living, the policy provides coverage for certain increases in living expenses and, if any part of the premises is rented out; for any loss of rental income. This would include providing you and your family with temporary living expense, such as the cost of a hotel or apartment while your home is being rebuilt. Also the additional expense, over and above your normal living expense that is the result of the loss to your home is covered by this policy part. An example might be dry cleaning of smoke damaged furniture or clothing cause by the loss to your home. This amount of coverage is in addition to Coverages A, B, and C. The cost of storage of your undamaged items in your home at an off site location would also be covered by this policy part. The policy provides an additional 20% of Coverage A for Loss of Use.


1. Debris Removal—Reasonable expenses for the removal of debris of covered property if an insured peril causes the loss if provided in the homeowners policy.

2. Reasonable Repairs—If covered property is damaged by an insured peril, the policy reimburses an insured’s reasonable costs incurred for the purpose of protecting the property from additional damage. This would include such things as boarding up after covered storm damage by a contractor.

3. Trees, Shrubs and Other Plants—Coverage applies to such property that is located on the residence premises. However, the loss must be due to fire, lightning; explosion; riot; civil commotion; aircraft; vehicles (not owned or operated by a resident); vandalism; malicious mischief; or theft.

4. Property Removed—If covered property is being removed from a premises endangered by a covered peril, the property moved has coverage for up to thirty days.

5. Credit Card, Fund Transfer Card, Forgery, and Counterfeit Money—$500 is available if an insured is legally obligated to pay for a theft or unauthorized use of the insured’s credit cards, fund transfer cards; or if there is a loss caused by forgery or alteration of a check or negotiable instrument, or a loss caused by the insured unknowingly accepting counterfeit U.S. or Canadian paper currency.

Coverage is excluded when the loss involves:

any illegal act by a person entrusted with a card;
an insured who has not complied with all of a card’s terms and conditions; or
any business loss or dishonesty of the insured.

  • 6. Loss Assessment—The insurer will pay up to $1000 for the insured's share of a loss assessment charged during the policy period if the assessment is due to a direct loss to collectively-owned property. The damage has to be caused by a covered dwelling peril. This coverage generally applies to your membership in a homeowners association or condo association.

7. Collapse—There is coverage for direct physical loss to covered property involving collapse of any part of a building. However, the collapsed must be caused by hidden decay; hidden insect or vermin damage; weight of contents, equipment, animals, or people; or weight of rain which collects on a roof. This additional coverage also pays for collapse that occurs during the course of construction, remodeling or renovation IF the collapse involves defective material or methods.

No coverage is available for damage to an awning, fence, patio, pavement, swimming pool, underground pipe, flue, drain, cesspool, septic tank, foundation, retaining wall, bulkhead, pier, wharf, or dock unless the loss is a direct result of the collapse of a building.

8. Glass or Safety Glazing Material— Up to $100 is available for the breakage of glass or safety glazing material or for damage to covered property by glass or safety glazing material, when the glass is part of a covered building, storm door or storm window.

Covered Causes Of Loss For Property

DWELLING AND OTHER STRUCTURES (COVERAGES A AND B AND C)— These coverage parts provide protection against direct physical loss to property. However, the following sources of loss are excluded:

    • collapse other than that provided in the Additional Coverage Section;
    • freezing of a plumbing, heating, air conditioning, or fire protective sprinkler system or a household appliance-when the dwelling is vacant, unoccupied or being constructed, unless reasonable care has been taken to maintain heat in the building, or the water supply has been shut off and the appliances and their systems drained of water;
    • freezing, thawing, pressure or weight of water or ice, whether driven by wind or not, to any fence, pavement, patio or swimming pool; foundation, retaining wall, or bulkhead; or pier, wharf or dock; theft in or to a dwelling under construction, or materials and supplies used in construction;
    • vandalism and malicious mischief when vacant for more than 30 consecutive days;
    • wear and tear, marring, deterioration; inherent vice, latent defect, mechanical breakdown;
    • smog, rust or other corrosion, mold, wet or dry rot;
    • smoke from agricultural smudging or industrial operation;
    • discharge, dispersal, seepage, migration, release, or escape of pollutants unless caused by a covered peril;
    • settling, shrinking, bulging, or expansion, including resultant cracking, of pavements, patios, foundations, walls, floors, roofs, or ceilings;
    • birds, vermin, rodents, or insects; or animals owned or kept by an insured.

      Property Exclusions
    • Ordinance or Law: the enforcement of any ordinance or law regulating the construction, repair, or demolition of a building or other structure.
    • Earth Movement includes the peril of earthquake. Can be included by endorsement for a premium.
    • Water Damage: flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind; water which backs up through sewers or drains or which overflows from a sump; or water below the surface of the ground, including water which exerts pressure on or seeps or leaks through a building, sidewalk, driveway, foundation, swimming pool, or other structure.
    • Power Failure: the failure of power or utility service if the failure takes place off premises.
    • Neglect: neglect of the insured to use all reasonable means to save and preserve property at and after the time of a loss.
    • War
    • Nuclear Hazard
    • Intentional Loss
    • Weather conditions
    • Acts or decisions, including the failure to act or decide, of any person, group, organization, or governmental body.
    • Faulty, inadequate or defective planning, zoning, development, surveying, site design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction materials used in repair, construction, renovation or remodeling; or maintenance of any property whether on or off the residence premises.


PERSONAL LIABILITY COVERAGE E—The policy protects against claims or suits involving an insured for damages from bodily injury or property damage caused by an occurrence covered by this insurance. The insurer will pay up to the limit of liability for damages that the insured is legally liable, including prejudgment interest awards. The policy also provides a legal defense even if the suit is groundless, false or fraudulent. The insurer has full authority to investigate and settle any claim or suit that it decides is appropriate. The insurer's duty ends when the amount paid is equal to the limit of insurance stated in the policy.


MEDICAL PAYMENTS TO OTHERS COVERAGE F - There is a $ 200 limit on money, bank notes, bullion, gold, silver, platinum, coins and medals. A $250 LIMIT applies to property away from the premises used at any time, in any way for business. A higher limit of $1,000 limit applies for securities, letters of credit, notes, manuscripts, deeds, accounts, stamps, passports, tickets, watercraft including trailers and furnishings. Theft of jewelry watches and furs also has limit of $1000. For theft of firearms there is a $2,000 limit. Finally, a $2,500 limit applies to theft of silverware, silver-plated ware, gold ware, gold-plated ware, pewter ware including flatware, hollow-ware, tea sets, trays, and trophies made of or including silver, gold or pewter. Theft of property from your residence used at any time or in any manner for any business purpose is limited to $ 2,500.

Section II-Liability Exclusions

The Special Homeowners policy prohibits coverage for losses that an insured expects or intends or that arises out of or in connection with an insured’s business. The policy also excludes:

    • the rental of any part of any premises. There is an exception for the rental of an insured location if it is done on an occasional basis, for use as a residence, office, school, studio, or private garage
    • professional liability
    • any premises owned by or rented to an insured, or rented to others by the insured that is not an insured premises.
    • ownership, maintenance, use, loading or unloading of motor vehicles or motorized land conveyances (including trailers). The exclusion includes the entrustment of such property to any person as well as to any vicarious liability from the actions of a child or minor using such property.
    • ownership, maintenance, use, loading, or unloading of an excluded watercraft.
    • ownership, maintenance, use, loading or unloading of an aircraft; entrustment by an insured of an aircraft to any person; or vicarious liability for the actions of a child or minor using an aircraft.
    • war, insurrection, rebellion, revolution; warlike acts; destruction, seizure, etc.;
    • transmission of a communicable disease;
    • sexual molestation, corporal punishment or physical or mental abuse; or,
    • the use, sale, manufacture, delivery, transfer, or possession by any person of a Controlled Substance(s)
  • Personal Liability-Coverage E

This coverage does not apply to liability for any loss assessment charged against the insured; any contract or agreement; property damage to property owned, rented to, occupied or used by, or in the care of the insured; bodily injury or property damage for which an insured is also an insured under a nuclear energy liability policy or would be an insured under a policy but for which the limits have already been exhausted.

Medical Payments To Others-Coverage F

This coverage does not apply to bodily injury to a residence employee if the bodily injury occurs away from the insured location; to any person eligible to receive either mandatory or voluntary benefits under any workers compensation, non-occupational disability, or occupational disease laws; to bodily injury from nuclear reaction, radiation, or radioactive contamination, regardless of how caused; nor to any person, other than an insured’s residence employee, regularly residing on any part of the insured location.

Section II-Additional Coverages

Claims—The special homeowners policy covers the expenses and costs assessed against an insured in any suit that the insurer defends including any premiums on bonds required in that suit; reasonable expenses incurred at the request of the insurer; and if there is an entry of judgment, the insurer will pay any interest on the entire amount that accrues before the insurer makes payment.

First aid expenses—The policy covers first aid expenses to others. No coverage is provided to any insured.

Damage to property of others—A maximum of $500 exists to pay for the property of others damaged by an insured.

Loss assessment Liability—Up to $1000 per occurrence is available to pay for the insured's share of a loss assessment.