What Are Some Different Types of Home Insurance Policies?

What Are Some Different Types of Home Insurance Policies?

What Are Some Different Types of Home Insurance Policies?

Types of home insurance policies include the limited coverage policy, which is a bare-bones policy that is fading in most state markets; the basic coverage plan, which protects from a broad range of disasters; and the special plan, which is the most comprehensive and popular plan for homeowners, according to Insurance Information Institute. Different plans offer coverage for anyone who rents a home or owns a condo.

The basic coverage plan, also known as HO-2, provides coverage from a large list of perils, explains National Storm Damage Center. The policy covers claimants for damages due to fire, vandalism and theft; snow, hail and lightning; vehicles; collapse; pipe freezing and several other conditions. The special plan, known as HO-3, or the "All Risk" policy, distinguishes itself from HO-2 by covering all damage with exception to a small list of perils. Ordinance of law, governmental action, earth movement, war and military actions, and nuclear hazard don't receive coverage under the HO-3 policy. Other perils that the HO-3 policy doesn't cover include power failure, water and flooding, inherent defects and vermin.

Renters insurance policies for non-homeowners cover possessions and any parts of the home or apartment that the renter owns. A similar insurance policy covers owners of condos or co-ops from the same list of damages, reports Insurance Information Institute.