Types of Homeowner Insurance Policies

There are several different types of Massachusetts homeowner insurance policies. These vary by whether you own a home, condo, or if you are a renter. The various policies provide different levels of coverage.

The most basic policy, the HO-1, covers only a few perils and insurance companies have stopped selling it in most states because of its narrow coverage.  The HO-2 (aka Homeowners 2, Broad Form) policy is a named-perils policy. This means that your dwelling and personal property are covered for 16 perils.  If your home is damaged by a peril that is not among one of the 16 named, it is not covered.

The HO-2 perils are:

  • Fire or lightning
  • Windstorm or hail
  • Explosion
  • Riot or civil commotion
  • Damage caused by aircraft
  • Damage caused by vehicles
  • Smoke
  • Vandalism or malicious mischief
  • Theft
  • Volcanic eruption
  • Falling objects
  • Weight of ice, snow, or sleet which causes damage to a building
  • Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning or automatic fire-protective sprinkler system or from a household appliance 
  • Sudden and accidental tearing apart, cracking, burning, or bulging of a steam or hot water heating system or an air conditioning or automatic fire-protective system
  • Freezing of a plumbing, heating, air conditioning or automatic, fire-protective sprinkler system or of a household appliance
  • Sudden and accidental damage from an artificially generated electric current

The HO-3 (aka Homeowners 3, Special Form) is the most commonly purchased policy.  Iit covers everything except certain perils outlined in the policy.

The HO-3 exclusions are:

  • Water damage, such as floods, sewer back-ups and water that seeps through the foundation Earth movement, such as earthquakes, shockwaves, sinkholes, landslides and mudflows
  • Ordinance or law, such as demolition or construction required to bring your house up to code
  • Power failure
  • Neglect, meaning you failed to take reasonable means to save your property during or after a loss
  • War, including undeclared war and civil war
  • Nuclear hazard
  • Intentional loss, meaning something you did on purpose with the intent to cause a loss
  • Government action, such as the destruction, confiscation or seizure of covered property by any governmental or public authority
  • Mold, fungus, or wet rot (some coverage may be provided in your policy)
  • Birds, vermin, rodents, or insects
  • Wear and tear, or deterioration
  • Loss to property, resulting from faulty zoning, bad repair or workmanship, faulty construction materials and defective maintenance

If something happens to your home that is not specifically listed as one of the above exclusions, it is covered under an HO-3 policy. However, review your policy so you that you know exactly what is or isn't excluded, as policies may vary by state or insurance company.

Although flood damage is excluded under standard homeowners and renter's insurance policies, you can purchase flood coverage through the National Flood Insurance Program (NFIP).

No matter what type of policy you buy, make sure your coverage limits are high enough to properly reimburse you for damage to your home. If you haven't upgraded your policy recently, you may find that you don't have enough coverage to repair or replace your home or your possessions in the event of a disaster. Remember, the best time to know what your policy covers is before your home suffers damage.