HO-2 Insurance | Bankrate

an ho-2 policy is one of many types of insurance policies available to homeowners. Despite being referred to as “comprehensive coverage,” HO-2 policies are not the standard policy option for most homeowners. Unlike a ho-3 policy, the most common type of homeowners policy that provides coverage for perils except those specifically excluded, a ho-2 policy only provides coverage for a designated peril. however, there are many benefits to a ho-2 policy depending on your individual needs. Knowing what a ho-2 policy does and does not cover is imperative before deciding whether to purchase this type of policy for your home.

what is ho-2 insurance?

Property and casualty insurers typically offer eight different types of coverage, also called “policy forms,” ​​for homeowners, condo owners, and renters. some are specific to the type of home you live in. An HO-5 policy, for example, is a fully comprehensive open-risk policy designed for high-value homes (home limits greater than $1 million). ho-4 policies exist only for renters, while ho-6 policies are for condo owners, and ho-7 insurance is designed to protect those who own mobile and manufactured homes.

Reading: What is an ho2 insurance policy

If you own a traditional home, there are several homeowners policy options. an ho-1 policy offers the lowest levels of protection. At the other end of the spectrum is the ho-5 policy, which gives you the strongest protection of the various forms of coverage. however, this type of policy usually comes with requirements that your home must meet.

ho-2 policies are a step up from ho-1 policies, but they don’t offer as much coverage as a ho-3, which is the most common type of homeowners insurance policy.

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Like other home insurance policies, ho-2 insurance is made up of several types of standard coverage, including:

  • dwelling coverage, for the dwelling itself
  • Coverage for other structures, for detached structures such as sheds, fences, detached garages and in-ground swimming pools
  • personal property coverage, for your belongings, such as clothing, furniture and electronics
  • liability coverage, in some cases, for protection if you are found at fault for injuries or damage to someone else’s property that occurs on your property
  • additional living expenses coverage, which provides temporary living coverage in the event your home becomes uninhabitable due to a covered loss
  • named hazards vs. open hazards

    The various components of home insurance policies are covered on a designated perils basis or on an open perils basis. Generally, a named perils policy will cover only the specifically named perils, such as fire or wind, listed in the policy. An open perils policy protects you against any loss unless it is explicitly stated as an exclusion.

    A ho-2 insurance policy covers homeowners based on specific risks. This means that your policy will only cover damage caused by a peril that is specifically listed in the policy. If your home is damaged by an incident that isn’t specifically mentioned, it probably won’t be covered.

    policies ho-2 vs. ho-3

    Before you choose a homeowners insurance policy, you should understand the difference between how a ho-2 policy and a ho-3 policy cover the structure of your home and your personal belongings. Below is a table showing how ho-2 and ho-3 policies cover losses.

    ho-2 hedges

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    Now that you know that a ho-2 policy only covers specifically named losses, you may be wondering what those losses are.

    what do ho-2 policies cover?

    an ho-2 policy typically lists 16 identified perils. they are:

    • fire and lightning
    • wind storm and hail
    • explosions
    • riots and civil commotion
    • damage caused by aircraft
    • damage caused by vehicles
    • smoke
    • vandalism
    • theft
    • volcanic eruption
    • falling objects
    • damage caused by the weight of ice, snow, or sleet
    • accidental discharge of water or steam from an appliance or from a plumbing, heating, air conditioning, or sprinkler system
    • sudden and accidental tearing, cracking, burning, or bulging of a steam or hot water heating, air conditioning, or sprinkler system
    • freezing of an appliance or plumbing, heating, air conditioning or sprinkler system
    • sudden and accidental damage from an artificially generated electrical current
    • what do ho-2 policies exclude?

      Like most homeowners policies, ho-2 insurance generally does not cover flood and earthquake coverage. Other exclusions may include:

      • water damage caused by drain or sewer overflows
      • nuclear accidents
      • war
      • landslides and mudslides
      • sinks
      • mold
      • pests such as rodents or termites
      • power failure
      • damage as a result of careless maintenance
      • Some homeowners insurance providers offer the ability to add optional types of coverage to your policy with riders, also called endorsements. You may be able to add a rider to cover mold damage or sewer overflow damage, for example. Flood and earthquake coverages can also be added as endorsements or you may need to purchase separate policies for these perils.

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        frequently asked questions

          • where can i buy ho-2 insurance?
            • how much does a ho-2 policy cost?
              • what kind of homeowners insurance should I get?
                • what perils are not covered by ho-2 or ho-3 policies?

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