HO3 vs HO8: Which a homeowner should choose?

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PostPosted: Fri Aug 29, 2008 8:21 pm   Post subject: HO3 vs HO8: Which a homeowner should choose?  

What are the basic differences between ho3 and ho8? What is the protection available under Ho8 policy?

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PostPosted: Sat Aug 30, 2008 10:24 am   Post subject: HO3 vs HO8  

HO3 is the most popular form of homeowners policy written for insuring the homes. HO3 policy covers most of the perils that may damage your dwelling.



HO8 is specially designed to protect the heritage and old dwellings. It offers protection against perils like- theft, riots, volcanic eruption and so forth. Normally, you can receive the actual cash value for your damages, ie. it'll replace the damaged property after deducting the depreciation costs. The ho3 vs ho8 debate would remain, but it's important to understand the different factors that support each of these.



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Rupert

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PostPosted: Sat Aug 30, 2008 11:15 pm   Post subject: HO3 vs HO8  

HO-1: Limited coverage policy

This “bare bones” policy covers you against the first 10 disasters. It's no longer available in most states.



HO-2: Basic policy

A basic policy provides protection against all 16 disasters. There is a version of HO-2 designed for mobile homes.



HO-3: The most popular policy

This “special” policy protects your home from all perils except those specifically excluded.



More at CondoAssociation.com


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Roger
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PostPosted: Fri Jun 12, 2009 10:30 pm   Post subject: ho8 vs ho3  

Is an HO3 policy a replacement policy?


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PostPosted: Wed Jul 08, 2009 10:44 am   Post subject: HO3 vs HO8  

Well Case, leaving the ho8 vs ho3 debate aside, you normally have a choice with the HO3 policy. You can either opt for actual cash value coverage, which would cost you less than the replacement cost coverage. But HO8 normally offers actual cash value coverage only, i.e. if your ancestral home gets damaged the insurer would deduct the depreciation value of the property from the claim amount and would pay the remaining.

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PostPosted: Tue Aug 18, 2009 6:37 pm   Post subject:   

does ho 3 have replacement coverage and water coverage


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PostPosted: Thu Dec 02, 2010 12:05 pm   Post subject: Replacement cost  

Can you get replacement cost loss settlement in the HO-8?


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Roger
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PostPosted: Tue Dec 07, 2010 6:13 pm   Post subject:   

HO-8 is a stated value/agreed value property form for dwellings that are too old or have special value that cannot easily be calculated in terms of replacement cost. They may be of historic importance (greater value than pure replacement cost) or so old or in such condition that the actual value is far less than replacement cost based on square footage.



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PostPosted: Wed Nov 13, 2013 6:31 pm   Post subject: home insurance  

The 2014 assessed value (which is determined by market value in our area) of our home built in 1919 is $47,200. The replacement cost is $260,000. We are retired (on limited income) and do not have a mortgage on the property. What type of insurance would you recommend we look at. Thank you.


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PostPosted: Fri Nov 15, 2013 5:08 am   Post subject:   

Are you concerned about losing your home to fire, tornadoes, explosion, or any of a dozen or so other causes? Are you concerned about losing all your furniture, clothing, and other personal property?



If you are, then you need a homeowner's policy (HO8) if your home is a "collector's item".or would otherwise be difficult to replace as-is. You must insure for at least 80% of the replacement cost -- $208,000 if your estimate is correct. But I would recommend at least $240,000 (or more), in case your $260,000 is off by 15% ($300,000).



If not, then look at an annuity to provide you with lifetime income instead. You may need it to help pay rent after your home burns down without insurance to rebuild it.



Talk with a local agent or broker.



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PostPosted: Wed Jan 29, 2014 2:57 pm   Post subject:   

I would not recommend anyone purchase an HO-8 policy if the HO-3 is available. The HO-8 is going to actual cash value for not replacement cost. In our state (FL) these policies also carry limited water damage that is capped off at 10,000. Many of the carriers HO-8 policies are stripped down and may only provide actual cash value on your personal items as well. Meaning if you bought a 50 inch TV for 1200 dollars and it is stolen 3 years later you may only receive 300 dollars for your TV. In some cases an owner occupied DP-3 policy will provide better coverage then an HO-8.

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PostPosted: Wed Jan 29, 2014 7:23 pm   Post subject:   

Quote:
I would not recommend anyone purchase an HO-8 policy if the HO-3 is available.


Please be careful what you post. Blanket statements such as this. Why? Because the original question simply asked what is the difference between an HO-3 and an HO-8 policy.



There are absolutely circumstances in which the HO-3 policy will be 100% wrong. The whole purpose of an HO-8 policy is to provide adequate protection to the homeowner whose home is of historical value, constructed of materials not easily replaced, or otherwise more valuable than mere "replacement cost."



Let's say you own a mansion built in the 1850s. It is comprised of 5 bedrooms, a kitchen, dining room, and living room, as well as a library and salon. It also has a 3/4 wraparound porch, several masonry fireplaces, and a crystal chandelier in the grand entry. Total square feet = 3,000 on two floors. There have been no renovations other than modernization of electrical and plumbing. In other words, this is a 19th Century showpiece.



What would the cost be to replace a 3,000 sq ft two-story tract home? How does that compare to a home that is 150 years old, built with materials and methods that few people have skills or knowledge in dealing with them. A shoddy repair with modern materials to a damaged wall could cause the property to lose substantial value. To repair the same damage could cost five times as much as modern construction.



Your HO-3 policy will not cover that 5x damage claim. It will only pay the cost of modern materials.



As for a DP-3 providing better coverage than an HO-8, I rather doubt that. Can you provide specific examples? You need to explain why an owner-occupied dwelling would be better covered with a DP- form than an HO form. What will protect the owner-occupant for the loss of personal property if all he has is a DP-1, -2, or-3?


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PostPosted: Thu Jan 30, 2014 6:45 pm   Post subject:   

I can not speak for your markets, it appears your specialize in Life and Disability. But we have markets to write a DP-3 owner occupied with up to 40% of Coverage A for Personal Property. Almost the same amount standard on an HO-3. The DP-3 also includes 25% increase for ordinance or Law coverage. Along with that it is written under special form with replacement cost and included s coverage for water damage. I would never recommend someone purchase a policy that is actual cash value when an H0-3 or DP-3 policy can provide replacement cost. If you would like to use the 1850's mansion example that's fine but that is an exception to the rule as I do not quote very many of those. Since you stated only the plumbing and electrical have been updated I would say a 164 year old roof is not insurable in the first place and the mansion is not relevant to the original question.



However, I can inform you that we have carriers that pay CSR's and Agents and additional 50 dollars per application to write the policy under the HO-8 policy form instead of the HO-3 or DP--3. form. This is because it is an actual cash value policy with limited coverage. This is very profitable for the Insurance carrier. If you would like to read the HO-8 mortified form policy conditions you can view them at this link.



http://www.filedropper.com/ho-8



actual product vs ISO form can vary greatly.

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