Legal coverage for protection against any sort of damage to a person’s home is offered by home insurance companies. Repairing, reconstructing or replacement of the damaged property is also included. Different types of home insurance policies are offered by different insurance companies. There is usually an additional substantial discount with most insurance policies. The different types of home insurance are:
- HO- 1: The first ten disasters are covered by this type of insurance policy, which are of least significance. Loss or damage incurred as a result of windstorm, malicious mischief or vandalism, theft, lightning, fire etc. is usually covered by this type, and some valuable items like antique fixtures or articles, paintings etc. are also covered. However, due to its narrow coverage, this policy has become almost obsolete these days.
- HO- 2: Recognized as the Basic Home Insurance Plus, HO- 2 is a policy for limited coverage. All 16 potential disasters are covered by this policy. Three types of damage associated with water from appliances or utilities, weight of ice or snow, electrical surge damage, damage from falling objects etc. are typically covered by this type of insurance. Mobile homes are specially provided with coverage by this insurance type.
- HO- 3: The most popular among all types is this special or extended homeowners insurance, by which almost all disasters are protected against. This is a category of HO-2 and it includes 17 confirmed perils. Both contents and the structure of a house are covered by it, as well as the routine use of liabilities. Because of its all risk policy, a large area of your home is covered by this insurance type and even accidents or injuries to guests are covered. Due to its vast coverage area, it is always a policy preferred by homeowners.
- HO- 4: Known as renter’s or tenant’s policy, this cheap and exclusive policy is specially preferred by those who have rented an apartment. Having a high amount of coverage, an apartment and its domestic contents, e.g. kitchen cabinets, are covered by it. Even casualties such as any accident or injury incurred by you or any passersby or guest within 150 feet of your property are covered.
- HO- 5: Both the property, the property owner and his/her personal belongings are covered by this policy, which is mostly similar to HO- 3. But due to its better protection formula, it somewhat differs from HO- 3. Larger areas of loss or damage are covered by it, and any casualties incurred by you or any passersby or guest are covered by it too.
- HO- 6: This auxiliary type is a coverage policy for condominium owners, as both building items and personal property are covered, as well as all the 16 disasters. Claims filed for any damage or mishap incurred are protected by this policy, which includes theft, fire or any other sort of future loss.
- HO- 8: Basically the rebuilding or repair cost of personal property and the actual money value is covered by this type of insurance, especially for older or purported historical homes. The actual cost of old properties is the foundation on which the reimbursement for damage is based and offered. This means that the depreciation value is not deducted in paying for the replacement or rebuilding. But policies for full replacement cost become difficult to achieve several times for a number of older homes.
Aside from the above-mentioned basic types of home insurance policies, there are some additional types:
Replacement Cost Guaranteed
The highest measure of protection is provided by this policy. However, the policy limit is exceeded by this, and after any occurrence of the disaster, the entire reconstruction cost is paid by this policy. Any unexpected rise in the cost of the construction is also protected by this policy.
The materials related to construction may lower the cost of construction after any unexpected event or disaster. However, older homes are not usually included in this type of home insurance policy.
Replacement Cost Extension
A particular percentage is paid by this policy in excess of the policy’s limit for home reconstruction. For instance, an additional $25,000 coverage is obtained by the purchase of a $100,000 policy. Money would likely be saved by you in any case, and this can be done by gathering more and more quotes. Today, a quick way of saving money at no cost can be by obtaining a quote.
Purchasing a home insurance policy is easy, but selection of the right type of insurance policy is necessary for saving money as well as for protecting yourself from losing money. Research is a must before deciding to buy any insurance. You can achieve the cheapest home insurance only after comparing prices.