HO3 vs. HO5 - Which one should you opt for?

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PostPosted: Wed Dec 29, 2010 4:27 pm   Post subject:   

Standard ISO property policies all include the following as covered causes of loss:



Fire; lightning; extended coverages; vandalism & malicious mischief; theft; falling objects; weight of ice, snow, and sleet; accidental discharge of water, sudden tearing apart of heat, A/C, hot water system; freezing; artificially generated electrical current



Common exclusions under ISO "broad form" property policies include:



Theft, liability, land, other structures used for commercial, manufacturing, farming or rental, animals, birds, fish, aircraft, boats other than rowboats or canoes, accounts, bank notes, bills, coins, currency, deeds, credit cards, motor vehicles, data, flood, earth movement, nuclear hazards, war, power failure, ordinance or law, neglect, intentional acts



An HO-3 is a "broad form" of coverage -- but specifically known as "open perils" coverage on the dwelling/structures and "named perils" coverage for personal property. This means all causes of loss to the dwelling itself are covered EXCEPT THOSE SPECIFICALLY EXCLUDED by the insurance company, and only the named causes of loss apply to personal property.



Although the prior post states:

Quote:
Water damage, Power Interuption, and Ordinance of law are all covered perils under a HO-3 policy




that will only be true if they are not excluded by the language of the contract (and the term "water damage" is poorly used here -- the real word is "flood" -- water damage is covered under many circumstances other than as a matter of "neglect", such as that caused by a leaking pipe over many years). The "common" exclusions are often found in HO-3 contracts. Earth movement, flood, nuclear hazard, and war/riots/insurrection are almost always excluded from homeowner's/dwelling policies.



Contracts do vary from one insurance company to another, so it pays to know what to look for and to read the contract to be certain what is not in the list of exclusions, since insurance companies are free to describe what they do or do not cover under an HO-3 policy.



Specifically, however, an HO-3 would never cover under "Ordinance or Law" (if O-or-L is not excluded) a retrofit of an existing dwelling to comply with earthquake safety laws or modifications to the premises to comply with the Americans with Disabilities Act (ADA). Those things might be covered as contingent losses in the reconstruction of a dwelling following a total loss due to another covered cause.



So even some other "insurance professionals" don't always get it right, either.


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PostPosted: Sun Apr 10, 2011 11:40 pm   Post subject: HO-3  

suggestions on a good ho-3 policy provider?


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PostPosted: Mon Apr 11, 2011 8:00 am   Post subject:   

An HO5 is a comprehensive homeowner's policy that provides all-risk coverage for the home, personal property, other structures, and loss of use. It was created to give those considered to be better risks broader coverage than an HO/3 at a better price. An HO5 essentially covers the personal property the exact same way it covers the home structure itself. There is coverage for anything that could possibly happen....except for what is excluded in the policy. In an H03 the personal property is covered for only 16 perils (which are listed in the policy). If anything else happens to the property there is no coverage.

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PostPosted: Fri Apr 15, 2011 12:14 pm   Post subject:   

Quote:
suggestions on a good ho-3 policy provider?




The one that will insure your property at the price you can afford.


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PostPosted: Mon Jun 06, 2011 3:19 pm   Post subject: HO 5  

Sil - your explanation on the HO5 is inaccurate. Most of the exclusions you listed under the HO3 are also excluded under the HO5. Additionally, water damage is covered under the HO3 if its from a wind storm. It's not covered if it's from a flood.


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PostPosted: Wed Mar 28, 2012 9:42 pm   Post subject: 16 perils  

what are the 16 perils?


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PostPosted: Thu Mar 29, 2012 3:01 pm   Post subject:   

Is this a test? What do I win if I answer correctly?



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PostPosted: Fri Oct 19, 2012 1:22 pm   Post subject:   

Explain Act of negligence please.


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PostPosted: Fri Oct 19, 2012 2:55 pm   Post subject:   

Duty owed, duty breached = act of negligence



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PostPosted: Thu Nov 22, 2012 4:20 pm   Post subject: Insurance Company Comparison  

How do you compare american commerce home insurance versus state farm?


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PostPosted: Tue Nov 27, 2012 3:08 pm   Post subject:   

American Commerce is a part of MAPFRE Group



Using just CA Dept of Insurance data for 2011:



HOMEOWNERS



MAPFRE $2,396,363 in premiums . . . 0.0347% market share . . . 74.92% loss ratio. Not even in the list of 50 largest insurers (the smallest company on the list has 22,333 policies) to make it onto the complaint list.



STATE FARM $1,515,373,625 in premiums . . . 21.9721% market share . . . 40.52% loss ratio, #19 on the list of 50 largest insurers (based on complaints) with 1,905,183 policies, and 1.7 complaints per 100,000 policies in 2011 (compared to 1.4 in 2010, and 0.5 in 2009).



PRIVATE PASSENGER AUTO LIAB & PROP DAMAGE



MAPFRE $132,454,697 in premiums . . . 0.6999% market share . . . 68.93% loss ratio . . . #49 on the list of 50 largest insurers in CA (based on complaints), with 245,277 policies and 9 complaints per 100,000 policies (compared to 5.6 in 2010, and 1.6 in 2009).



STATE FARM $2,597,966,864 in premiums . . . 13.7279% market share . . . 65.09% loss ratio . . . #16 on the list of 50 largest insurers (based on complaints) with 3,370,436 policies, and 1.4 complaints per 100,000 policies (compared to 0.7 in 2010, and 0.6 in 2009).



What else would you like to know? State Farm is huge in comparison to American Commerce, with almost 700 and 20 times more (homeowners / auto) premiums collected, substantially larger market shares, and lower loss ratios (more profitability).



Doesn't mean American Commerce/MAPFRE isn't reputable, isn't profitable, isn't a company you shouldn't do business with. They are simply tiny by comparison. Maybe that makes them better -- being able to give more attention to fewer policyowners. But their complaint ratio is high, so maybe they can't handle claims all that well.



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PostPosted: Mon Dec 03, 2012 6:48 am   Post subject: Theft of my guns in my cousin's truck  

My Guns were stolen out of my cousin's Truck along with his. Are my guns covered under my cousins HO3 policy?


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PostPosted: Mon Dec 03, 2012 1:24 pm   Post subject: Home insurance and Gun  

What kind of Gun did you two have? hunting rifle, antique or a normal one?



Homeowners' insurance might cover guns as personal properties, though there might be limitations for that. Again, some insurance companies specifically mention that the firearms should be kept in safe or locked cabinet.



Yours was in a TRUCK !!



Why don't you read your policy thoroughly?


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PostPosted: Tue Dec 04, 2012 6:01 am   Post subject:   

Your guns are not your cousin's property, therefore his homeowner's insurance will not cover their theft from his truck. You need your own insurance to protect your property.



Or a mean dog willing to sit in the truck while you're doing something else and leaving your guns unattended.



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PostPosted: Thu Mar 07, 2013 1:01 am   Post subject: wind blew a tree on my boat  

Under the HO-3, am I covered if the wind blew the tree down and it fell on my boat? I think I should get $1500. for boat & trailer. By the way, it also fell on my neighbors truck-no auto collision coverage. I feel obligated to pay...it was my tree. No coverage at all!!!


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