Homeowners Insurance Vocabulary Flashcards

Comprehensive vocabulary flashcards covering the types of homeowners insurance forms (HO-2 through HO-8), property and liability coverages (A-F), special liability limits, and common endorsements based on the License Exam Manual.

Multiline policy

A policy, such as the homeowners policy, that contains both property and casualty coverages in a single contract; also known as a package policy.

HO-2 (Broad Form)

A homeowners form providing broad coverage for both the dwelling and personal property, covering perils similar to DP-1 with extended coverage and V&MM, plus glass breakage and theft.

HO-3 (Special Form)

A homeowners form providing open peril coverage for the dwelling and other structures, while providing broad named peril coverage for personal property.

HO-4 (Contents Broad Form)

A homeowners form insuring tenants for their personal property on a broad named peril basis, providing no coverage for the dwelling.

HO-5 (Comprehensive Form)

A homeowners form providing open peril coverage for the dwelling, other structures, and personal property; it is the only form to cover mysterious disappearance.

HO-6 (Unit-owners Form)

A homeowners form providing broad coverage for the personal property of condominium owners and very limited dwelling coverage, typically with a $1,000$ standard limit.

HO-8 (Modified Coverage Form)

A homeowners form designed for older homes with replacement values exceeding market values, providing basic coverage on the dwelling and personal property with valuation restrictions.

Coverage A

Section I property coverage for the dwelling and structures attached to it, as well as materials and supplies for construction or repair located on or next to the residence premises.

Coverage B

Section I property coverage for other structures on the described premises separated from the dwelling by clear space, such as a detached garage.

Coverage C

Section I property coverage for personal property owned or used by an insured anywhere in the world, with a standard limit for property kept at other residences of $10\%$ of the limit or $1,000$, whichever is greater.

Coverage D

Section I property coverage for loss of use, which pays for additional living expenses and loss of fair rental value if a covered property loss makes the residence premises uninhabitable.

Coverage E

Section II personal liability coverage for damages the insured is legally obligated to pay because of bodily injury or property damage caused by an occurrence; standard limit is $100,000$ per occurrence.

Coverage F

Section II medical payments to others coverage that pays necessary medical expenses incurred within three years of an accident, applying to injuries sustained on an insured location or caused by the insured's activities.

Special Limit for Money

A specific coverage limit of $200$ for money, bank notes, bullion, gold, silver (not tableware), platinum, coins, and medals.

Special Limit for Jewelry (Theft)

A specific limit of $1,500$ that applies only to theft losses of jewelry, watches, furs, and precious and semi-precious stones.

Puffback

The sudden and accidental release of soot, smoke, vapor, or fumes from a furnace, boiler, or similar equipment, covered under the smoke peril.

Mysterious disappearance

The vanishing of property with no explanation; it is generally excluded in most forms but covered under the HO-5 comprehensive form.

Replacement Cost Formula

The formula used when an insured carries less than $80\%$ of the replacement cost: $\frac{\text{Insurance carried}}{\text{Insurance required}} \times \text{amount of loss} = \text{amount of reimbursement}$.

Scheduled personal property endorsement

An endorsement providing a separate schedule of open peril insurance for nine specific categories of valuable property, such as jewelry, furs, and fine arts, with no deductible.

Personal property replacement cost endorsement

An endorsement that modifies the valuation of personal property losses from actual cash value (ACV) to a replacement cost basis.

Permitted incidental occupancies endorsement

An endorsement that overrides exclusions for business activities conducted on the residence premises, such as professional offices or private schools.

Personal injury endorsement

An endorsement that expands the definition of bodily injury to include personal injuries such as libel, slander, false arrest, and invasion of privacy.

Actual Cash Value (ACV)

The basis on which losses are paid for personal property, awnings, carpeting, appliances, and outdoor equipment under most homeowners forms.

Fire Department Service Charge limit

An additional coverage that pays up to $500$ when the fire department is called to protect covered property from a covered peril; no deductible applies.