Homeowners Insurance Policies ( Ch. 22 & 23)

Homeowners Insurance Policies

Chapter Overview

• Course: RMIN 4000
• Instructor: Daniel Brown
• Institution: Terry College of Business, University of Georgia

Section I: Coverage Types

• Coverage A: Dwelling

  • Covers the house and structures attached to it.
  • Includes materials intended for construction.
  • Excludes land coverage.

• Coverage B: Other Structures

  • Includes other structures on the premises that are separated from the dwelling by clear space.
  • Examples: Detached garage, shed on a foundation, fences.
  • Excludes structures rented out or used for business.

• Coverage C: Personal Property

  • Covers personal property owned or used by the insured, applicable worldwide.
  • Coverage at another residence or in storage is limited to 10% of Coverage C or $1,000, whichever is greater.

• Coverage D: Loss of Use

  • Protection when the residence cannot be used due to a loss.
  • Includes: Additional living expenses, fair rental value, and prohibited use.

Section II: Liability Coverages

• Coverage E: Personal Liability

  • Protects against claims or lawsuits for bodily injury or property damage caused by negligence.
  • Pays amounts up to policy limits for which the insured is found liable.
  • Insurer covers defense costs.

• Coverage F: Medical Payments to Others

  • Covers reasonable expenses for injuries to others occurring on the insured location or by the insured's activities or owned animal.
  • Not dependent on legal liability.

Homeowners Policy Forms

• HO-2: Broad Form
• HO-3: Special Form
• HO-4: Contents Broad Form (Renters)
• HO-5: Comprehensive Form
• HO-6: Unit-Owners Form (Condo)
• HO-8: Modified Coverage Form

Forms Comparison: Coverage Details

Major Rating Variables for Homeowners Insurance

• Construction Type: Material and structure design.
• Geographic Location: Risk of natural disasters.
• Fire Protection: Proximity to fire services and hydrants.
• Reconstruction Cost: Assessing replacement value.
• Form Type: Type of homeowners policy chosen.
• Year of Construction: Age and condition of the home.
• Deductible: Amount the insured pays before coverage applies.
• Insurance Score: Risk evaluation based on credit history and other factors.
• Roof Factors: Type and condition of roofing material.