Get Cheap Home Insurance

HO-3 Insurance Policy: What It Covers

HO-3 Insurance, also known as a special form policy, is the most common type of homeowners insurance purchased in the United States. This comprehensive coverage is designed to protect homeowners from a variety of risks, offering a balance between affordability and extensive protection.

What is HO-3 Insurance?

HO-3 Insurance is a home insurance policy that provides coverage for your dwelling (the main house), other structures on your property (like a detached garage or shed), and your personal belongings. It also includes liability coverage, which offers protection if someone is injured on your property and you are found to be legally responsible.

What Does an HO-3 Insurance Policy Cover?

Coverage A: Dwelling

Dwelling coverage, also known as home structure coverage or building insurance, is a fundamental part of an HO-3 policy. It covers the cost to repair or rebuild your home if it’s damaged by a covered peril.

Coverage B: Other Structures

Other structures coverage, also known as detached structures insurance or outbuilding coverage, protects structures on your property that aren’t attached to your main house. This includes structures like detached garages, sheds, and fences.

Coverage C: Personal Property

Personal property coverage, also known as contents insurance or belongings coverage, helps cover the cost to replace your personal items, such as clothing, furniture, and electronics, if they’re stolen or damaged by a covered peril.

Coverage D: Loss of Use

Loss of use coverage, also known as additional living expenses or displacement coverage, helps cover your living expenses if your home becomes uninhabitable due to a covered peril and you need to temporarily relocate.

Coverage E: Personal Liability

Personal liability coverage, also known as legal liability insurance or lawsuit protection, provides financial protection if you or a household family member are found negligent for bodily injury or property damage caused to others.

Coverage F: Medical Payments

Medical payments coverage, also known as guest medical coverage or injury payment coverage, helps pay for a guest’s medical expenses if they get injured at your home, regardless of who is at fault.

Types of Perils Covered by an HO-3 Policy

An HO-3 policy covers your home and other structures on an open perils basis, also known as all-risk coverage or comprehensive perils. This means it covers damage from all perils unless they are specifically excluded in your policy. However, personal property is covered on a named perils basis, meaning it only covers damage from perils specifically listed in the policy.

The Difference Between Open Perils and Named Perils

The main difference between open perils and named perils lies in the coverage. Open perils provide coverage for any disaster unless otherwise excluded in your policy, while named perils only offer coverage for the losses listed, or named in your policy.

How is an HO-3 Policy Different from Other Types of Homeowners Insurance?

An HO-3 policy offers a broader range of coverage compared to other types of homeowners insurance like HO-1, HO-2, HO-4, HO-5, HO-6, HO-7, and HO-8 policies. Each of these policies is designed for different types of homes and coverage needs.

Exclusions in an HO-3 Policy

Despite its comprehensive coverage, an HO-3 policy does have exclusions. Common exclusions include damage from earthquakes, floods, sinkholes, and lack of maintenance, among others. It’s important to understand these exclusions and consider additional coverage if necessary.

Who Needs an HO-3 Policy?

HO-3 insurance policies are ideal for the average homeowner with a dwelling type that qualifies for the policy. However, depending on your specific needs and the type of home you have, you might need a different type of homeowners insurance.


Understanding your HO-3 insurance policy is crucial to ensure you have the right coverage for your home. It offers comprehensive protection for your dwelling, other structures, personal property, and provides liability coverage. However, it’s important to understand its exclusions and consider additional coverage if necessary. Always consult with an insurance professional to ensure you have the right coverage for your specific needs.

Leave a Comment