Home Insurance Forms

Learning about what is covered on your homeowner’s policies (including renter’s and condo) requires you to learn about the different homeowner’s forms. The homeowner’s forms are the contracts modified by the Texas Department Insurance. The forms decide what is covered. You can add on or modify this coverage with endorsements or riders.

Here are the perils that home insurance policies cover against. Covers the damage each peril causes:

Basic Perils (covered on all homeowner’s forms)

  • Fire and Lightning
  • Theft
  • Windstorm or Hail
  • Smoke
  • Explosion
  • Vehicles (not owned by the insured)
  • Riot or Civil Commotion
  • Damage caused by aircraft

Broad Perils (Covered on most homeowner’s forms, includes basic perils.)

  • Falling Objects
  • Freezing
  • Vandalism or Malicious Mischief
  • Damage due to weight of Ice, Snow, or Sleet
  • Sudden & accidental tearing apart, cracking, burning, or bulging of pipes.
  • Sudden & accidental damage from artificially generated electric current.
  • Accidental discharge or overflow of water from plumbing, air conditioning, water heater, ETC. (Does not cover the appliance that was leaking. Endorsement available)
Here are the exclusions (not covered unless endorsed) on each homeowner’s policy:
  • Ordinance or Law: Sometimes the city requires you to repair certain parts of your home or property. Your home insurance normally excludes this, but it can be endorsed.
  • Earth Movement: Earth quakes, sinkholes, and mudslides are excluded. Can be added by endorsement for certain events.
  • Water Damage: This includes flood in all forms! A separate policy is required for flood. Also includes water back up of sewers and drains. This can be added by endorsement. Seepage through a building or foundation is also not covered. This can be added by endorsement as well.
  • Faulty Appliance: This will be up to your appliance warranty. The damage the appliance causes is covered.
  • Power Failure: If this is caused by the city. Endorsements available.
  • Neglect: If the insurance company can prove that you did not fix a hazard before it caused damage, they can deny coverage.
  • War and Nuclear Hazard: If war breaks out in your area, you are on your own.
  • Wear and Tear: As your home and personal property gets older, it will wear down. This is not covered by your insurance.
  • Intentional Loss: Also known as insurance fraud. Insurance companies are very good at investigating into claims to make sure the loss is not a set up.
  • Governmental Action: This is different that ordinance or law. It the government needs to take action on your premises, this is not covered. Examples include kicking in doors during a raid, a shootout, or action during a emergency situation. If your door is wrongly kicked in, we recommend you take this up with your local police department.
Below are the homeowner’s forms and what is covered. But first, are some term you need to know:
  • Named Peril: This means if the peril is not listed on the policy it is not covered.
  • Open Peril: This means every peril imaginable is covered as long as it is not excluded.
  • Replacement Cost: This means the claim settlement will reimburse you for the items you need covered without factoring in depreciation.
  • Actual Cash Value (ACV): This means the claim settlement factors in depreciation of the material or object. Basically, it is replacement cost minus depreciation.

HO-2 Form

Basic coverage for owned homes.

Structure: Named peril coverage. Actual cash value (can be endorsed).

Contents: Named peril coverage. Actual cash value (can be endorsed).

HO-3 Form (Recommended by Milestone)

Special coverage for owned homes.

Structure: Open peril coverage. Replacement cost (can be endorsed back to ACV to save on premium).

Contents: Named peril coverage (Can be endorsed to open peril). Actual cash value (can be endorsed).

HO-5 Form

Comprehensive coverage for owned homes.

Structure: Open peril coverage. Replacement cost.

Contents: Open peril coverage. Replacement cost.

HO-4 Form

Coverage for a rental home, apartment, or condo. Does not cover the structure.

Contents: Named peril coverage. Actual cash value (can be endorsed).

HO-6 Form

Coverage for unit owners.

Structure (Limited): Only covers the part of the structure you are responsible for. Name peril coverage. Replacement cost.

Contents: Name peril coverage. Actual cash value (can be endorsed).

 

Please note, this information may be different depending on the carrier. Contact us for more information.