It is a wide misconception among many the people that homeowners insurance is used just to provide coverage for your home. Yet in reality it can also offer insurance coverage against variety sources of liabilities that may occur out of your family’s activities.
You should be aware that your homeowners insurance is indeed more than just one policy; it is actually a group of small policies that provide different levels of coverage. Additionally, there may even be supplementary options in your homeowners policy that manage uninsurable loss exposures, along with some restrictions and exclusions that can be managed much better with different policies or endorsements. In other words, your homeowners insurance policy can be series of forms to provide different types coverage towards circumstances with different degrees for your real and personal property as well as providing coverage for your personal liability.
There are six standard ISO forms (Insurance Services Office – advisory establishment that provides services for insurance companies) as follows;
oHomeowners-2 (HO-2): Broad Form
oHomeowners-3 (HO-3): Special Form
oHomeowners-4 (HO-4): Contents Broad Form
oHomeowners-5 (HO-5): Comprehensive Form
oHomeowners-6 (HO-6): Unit Owners Form
oHomeowners-8 (HO-8): Modified Coverage Form
oHO-2/3/5/8 are structured for owner-occupants of one to four dwellings where each unit may not hold any more than two families or one family and two roomers or boarders.)
oHO-4 is for residential property structured for the tenants as well as the owners of an apartment building who resides in one of its units.
oHO-6 is structured for the owners of the condominium units.
Further more, your homeowners insurance has two sections;
Section I: Property Coverage
Section II: Liability Coverage, which you should indeed pay special consideration to the definition “insured” and “insured location”, which is explained below;
Insured: Many people qualify as insured under Section I and Section II of your homeowners insurance. However the persons who fall under the definition of “you” will have rather more protection than other insured. Definition “you” may include;
oRelatives who are living in your residence
oChildren under 21 who are under the care of you and your relatives living in your dwelling
oFull-time students as long as they are under 24
oYour relatives and under 21 who are under your care.
Insured Location: It is always declared in your policy as it may include the following places;
oAny vacant land other than farm land that you own or rent
oParts of other structures and grounds that your spouse and you use as a residence
oYour family or individual burial vaults and cemetery plots
oAny part of a premises you sporadically rent other than your business use
oOther places you are temporarily residing yet not owned by you
oThe premise of your residence
These are actually the basics of your homeowners insurance. Nevertheless as it was mentioned above, you may also have supplemental options that can give you a variety of options to manage your homeowners insurance with separate policies and endorsements. Therefore when you are looking for a homeowners insurance, knowing these facts will help to design your policy. Yet more importantly it is highly recommended that you to talk to an insurance professional who can tailor your policy with respect your personal needs.