Homeowners Policy

HOMEOWNERS POLICY OVERVIEW

• Comprehensive insurance coverage designed to protect residential risks.
• Key inclusions:
  • Coverage for personal property of insured.
  • Liability coverage for insured parties.

ELIGIBILITY REQUIREMENTS

• Residences Must Be Owner-Occupied:
  • 1-4 unit dwellings only.
  • Maximum of 2 families or 2 roomers/boarders per unit.
  • Incidental business activities allowed, such as:
  • Piano lessons
  • Tutoring
• Ownership Types Covered:
  • Dwelling Under Contract
  • Townhome/Duplex
  • Non-owned Dwelling (Renters)
  • Seasonal Dwelling
  • Secondary Residence
• Business Coverage Limitations:
  • Very limited coverage for personal property used in business.
  • Liability coverage for business activities is generally excluded.
  • Option to add endorsement for business property coverage.

TYPES OF HOMEOWNER POLICIES

• Various homeowners policies include:
  • HO-2 (BROAD):
  • Named perils coverage for dwelling and personal property.
  • HO-3 (SPECIAL):
  • Open perils for dwelling & other structures, named perils for personal property.
  • HO-4 (RENTERS):
  • For tenants; coverage mainly for personal property.
  • HO-5 (COMPREHENSIVE):
  • Open perils, including coverage for mysterious disappearance.
  • HO-6 (CONDOMINIUM):
  • Coverage for personal property and limited coverage for dwelling.
  • HO-8 (MODIFIED FORM):
  • For older homes, covering limited perils with replacement cost based on older construction methods.

HOMEOWNER POLICY STRUCTURE

• Key Sections:
  • Section I – Property Coverage:
  • Coverage A: Dwelling
  • Coverage B: Other Structures
  • Coverage C: Personal Property
  • Coverage D: Loss of Use
  • Additional coverages related to property.
  • Section I – Perils Insured Against:
  • Specific perils listed for Coverage A and B, and personal property.
  • Section I – Exclusions:
  • Situations not covered by the policy.
  • Section I – Conditions:
  • Specific conditions that apply.
  • Section II – Liability Coverages:
  • Coverage E: Personal Liability
  • Coverage F: Medical Payments to Others.
  • Section II – Exclusions and Conditions:
  • Exclusions and conditions that apply to liability coverage.

COVERAGE DETAILS

• Coverage A – Dwelling:

  • Covers the dwelling as listed on the declarations page.
  • Includes materials and supplies next to the dwelling for construction.
  • Covers building equipment used to service the dwelling.
  • Not Covered: Land where the dwelling is located.

• Coverage B – Other Structures:

  • Covers structures detached from the dwelling (e.g., garages, sheds).
  • Limitations: Up to 10% of Coverage A value.
  • Not Covered: Land, business use of structures, rented structures.

• Coverage C – Personal Property:

  • Covers personal property of insured, resident family members, and specific types of personal property (e.g., model aircraft, handicap vehicles).
  • Not Covered: Money, animals, certain aircraft, and specified personal items.
  • Coverage Limits:
  • $200 for money, coins.
  • $1500 for securities and evidence of debt.
  • $1500 for watercraft and related property.
  • $2500 for firearms, jewelry, and precious items.

• Coverage D – Loss of Use:

  • Provides coverage for loss of use, up to 20% of Coverage A value.
  • Covers loss of fair rental value and additional living expenses due to covered losses.
  • Basic limitation on civil authority-related losses to 2 weeks.

NAMED PERILS VS. OPEN PERILS

• HO 2 Broad: Named perils for both dwelling and personal property.
• HO 3 Special: Open perils for dwelling and other structures, named for personal property.
• HO 5 Comprehensive: Open perils, covering all types of risks including mysterious disappearance.
• Special Coverage for Older Homes (HO 8): Specific replacement costs defined by common construction material methods.

KEY TERMS AND DEFINITIONS

• We, Us & Our: Refers to the insurance company.
• You, Your & Insured: Refers to the named insured, spouse, household residents, students, and others responsible for animals or property.
• Business: Any trade or occupation generating at least $2000 income annually.

INSURED LOCATIONS

• Insured Location & Residence Premises:
  • Single-family dwellings occupied by the insured.
  • Includes temporarily used premises and vacant land.

PERILS INSURED AGAINST

• Basic perils include:
  • Fire
  • Internal Explosion
  • Lightning
  • Extended Coverage Perils such as Wind, Hail, Aircraft, and Riot.

ADDITIONAL BROAD PERILS

• Include:
  • Burglar damage
  • Falling objects
  • Freezing or accidental discharge of water
  • Electrical current related damages.

ADDITIONAL COVERAGE, REPAIRS,AND EXPENSES

• Debris Removal: Covers costs associated with debris removal due to loss; includes tree removal costs under specified conditions.
• Reasonable Repairs: Reimbursement for necessary repairs to prevent further damage post-loss.
• Trees, Plants & Shrubs: Covered for named perils; coverage limit of $500 for any single item with a maximum of 5% total dwelling coverage.
• Fire Department Service Charge: Maximum coverage of $500 for fire response services.
• Property Removed: Coverage extends for up to 30 days for property removed due to endangerment.
• Credit Card & Fund Theft Coverage: Up to $500 coverage for theft or unauthorized use of credit cards without a deductible.

LOSS ASSESSMENT AND COLLAPSE

• Loss Assessment: Coverage capped at $1000 for costs assessed by property owner associations.
• Collapse: Defined as the sudden caving in of a structure, applicable under certain conditions related to property coverage.
  • Includes hidden decay or damage due to vermin or weight.

ADDITIONAL COVERAGES CONT'D

• Glass Safety Glazing Material Coverage: For breaking of glass due to earth movement.
• Landlord Furnishings Coverage (Excluding HO4): Up to $2500 for covered losses on personal belongings provided in rental units.
• Gravemarkers Coverage: Up to $5000 for covered loss of gravestones and mausoleums.
• Ordinance of Law Coverage: Up to 10% of Coverage A for costs incurred due to required compliance with laws or codes during rebuilding or repairs.

EXCLUSIONS

• Specific exclusions include:
  • Earth movement (e.g., earthquakes, mudslides).
  • War or nuclear hazards unrelated to fire.
  • Neglect of insured property.
• Other exclusions include liability limitations related to intentional actions, governmental actions, and certain types of assessments.

CONDITIONS

• Property Conditions: Duties following a loss must be performed, including notifying the insurer and making reasonable repairs.
• Loss Settlement: Based on Actual Cash Value (ACV) unless specified otherwise.
• Appraisal: Process for determining property value in damage disputes.
• Arbitration: Method to resolve disagreements regarding claims.
• Abandonment of Property: Insurer is not obligated to accept abandoned property.

LIABILITY COVERAGE DETAIL

• Coverage E – Personal Liability:
  • Covers claims for bodily injury or property damage, with a basic limit of $100,000.
  • Insurer covers legal defense costs for claims against the insured.
• Coverage F – Medical Payments to Others:
  • Covers medical expenses for injuries occurring on the insured property, excluding the insured and resident family members.

ADDITIONAL LIABILITY COVERAGES

• Claims Expense: Expenses incurred while defending lawsuits are covered.
• First Aid Coverage: Costs incurred for first aid are covered, excluding aid to the insured.
• Damage to Property of Others: Pays on a replacement cost basis for damages up to $1000.

LIABILITY CONDITIONS

• Bankruptcy of Insured: Does not relieve insurer of liability obligations.
• Claims Process: Detailed steps for claims notification, cooperation, and proof submission.

LIABILITY EXCLUSIONS

• Include negligence, damage to insured's own property, and worker's compensation exclusions.

CONDITIONS FOR BOTH PROPERTY AND LIABILITY COVERAGE

• Includes cancellation policies, subrogation rights, and legal representation under certain conditions.