This limited policy covers 10 perils (such as fire, vandalism, lightning or an explosion, to name but a few) compared to the 16 covered under equally affordable standard policies. Not including personal liability for injuries incurred while on your property, or automatically covering your belongings, a lot of mortgage companies don’t think these give as much coverage as is needed.
Usually covering all 16 named perils, this insurance is on the basic side with lower premiums and a lower level of coverage, but it is a ‘named peril’ policy, meaning that damage caused by events other than those listed on your policy, will not usually be covered.
Covering all disasters except those that are specifically excluded, this type of policy is perhaps the most popular one and protects you against any and all perils that are not specifically mentioned in the exclusions. This policy also covers attached structures, such as a deck or a garage, plus your belongings, and includes personal liability coverage should you accidentally injure someone or damage their property. That said, what is not covered, will depend on your specific policy.
Aimed at renters, this coverage protects your belongings against all 16 perils, but will not cover the building that you live in, as the landlord is responsible for that. If someone is injured in your home, or you need to pay for alternative accommodation while your landlord repairs or renovates the property, most HO-4 policies provide you with liability insurance.
If your home is new or in excellent condition, then this more comprehensive version of the HO-3 policy will be available to you provided you live within close distance of fire protection services. This coverage protects you financially against all perils unless they’re specifically excluded in writing and gives you better protection for your personal belongings than a HO-3.
Much like renter’s insurance, this condo or co-op policy covers the personal property of condo owners against all 16 perils and usually includes liability insurance. This coverage typically extends to the walls, ceilings and floors of your residence, while the building itself would be insured by the association.
This type of policy is for mobile or manufactured homes.
Designed to insure older properties, this coverage is like an HO-3 but has special elements to better protect older homes. Historic and registered landmark homes often have this type of coverage.