You may think that all Homeowners Insurance is created equal. Most homeowners believe that as long as the coverage limits and deductible match, a policy or quote must be the same. This is usually not the case. Many homeowners policies or quotes vary greatly from one to the next. One of the differences between homeowners policies is whether coverage is provided on a HO3 or HO5 form.

The HO3 is by far the most widely available policy form and should generally be considered the minimum coverage requirement when purchasing a homeowners policy. The HO3 Form covers a broad range of property types, but offers a more limited coverage for your personal belongings as detailed below:

HO3

HO5

Dwelling Coverage Type

Open Perils

Open Perils

Contents Coverage Type

Named Perils

Open Perils

Open Perils – Insures against all causes of loss that are not specifically excluded

Named Perils – Insures against a list of specified causes of loss and is therefore more restrictive by definition.

Here is a list of the named perils that limit the personal property coverage on a HO3:

Theft

Fire or Lightning

Explosion

Smoke

Freezing

Vehicles

Falling Objects

Volcanic Eruption

Windstorm or Hail

Riot or Civil Commotion

Damage caused by Aircraft

Vandalism or Malicious Mischief

Damage due to weight of Ice, Snow, or Sleet

Sudden & Accidental Tearing Apart, Cracking, Burning, or Bulging

Sudden & Accidental Damage from Artificially Generated Electric Current

Accidental Discharge or Overflow of Water from Plumbing, AC etc.  

HO5 Difference

The HO5 has less limitations than the HO3, adds new coverage, and expands some of the existing coverage such as a higher limit for jewelry and business personal property. Many of the coverages that are extras on the HO3 may be included on the HO5.

Which should you choose?

Even though the HO5 will cost a bit more, if you qualify for the HO5 it is the usually the best choice if you want the broadest coverage. Not only does it provide more coverage, but can also simplify the claims process by removing some ambiguity.

Never assume that you are getting an apples to apples quote. The HO3 vs HO5 difference is just one of the many differences you might find when trying to compare quotes or policies. It is important to know what you are getting. Ask your agent to explain the types of coverage and the options that you have on your policy and verify that you are getting equivalent coverage if you are reviewing a quote with a new carrier. =
If you would like to Contact Us or Get a Quote, we would love to help you with your Homeowners Insurance.