Buying a home is one of the most significant investments you will make in your life. No one wants to think about the potential of a fire destroying it or a thief absconding with your valuables. However, homeowners insurance provides reassurance that you can financially recover from these kinds of incidents. There are several different kinds of coverage available based on your property's characteristics, as explained below.

6 Types of Homeowners Insurance

1. HO–1 for Minimal Coverage

The basic option, an HO-1 policy is designed to cover the structure of the house. It does not include protection for personal property or liability claims. Instead, it covers named perils, such as fire, lightning, smoke damage, and vandalism.

2. HO–2 for Home & Belongings

The next level is the HO-2, which covers both your home and belongings should they face damage from a named peril. Its reach also extends beyond the parameters of the house. For example, you can receive coverage if your possessions are stolen from your car or another location. 

3. The Popular HO-3

HO-3 policies are the most common for owners because they cover the house, personal items, liability costs, and offer compensation for living expenses should you have to leave your home due to a named event. Mortgage companies often require at least an HO-3 homeowners insurance policy. 

4. The Comprehensive HO-5

For the most comprehensive coverage, opt for an HO-5. Everything above is included. In addition, there are also higher limits for big-ticket items like jewelry. The most significant difference is that it is an open perils policy, meaning it will cover damage for any event that is not specifically excluded from your contract. Typical exclusions are government actions, war, pest infestations, mold, and floods.

5. Condo HO-6

HO-6 policies are for those who own condominiums. Everything in the unit is protected from named perils. In addition, it provides personal liability and living expenses coverage. The building, itself, should be covered by the condo association’s policy. 

6. HO-8 for Historic Properties

When you have an older or historic home that will require more to restore following a disaster, choose an HO-8 policy. The coverage and limits are similar to an HO-3. However, the insurer acknowledges that the cost of repair may be greater than the property's current value.

To ask about coverage options, contact Allstar Insurance in Lincoln, NE. Family-owned, their agents bring decades of knowledge and experience for everything from renters to homeowners insurance, ensuring you find the right policies and rates for your situation. The team also specializes in high-risk insurance for autos and motorcycles. Call (402) 477-0900 to speak with an agent. Visit them online for more resources.