Understanding the Types of Homeowner Insurance Policies for Your Dwelling | Department of Insurance, SC (2024)

FAQs

What are the 3 types of coverage available in dwelling policies? ›

Coverage A — Dwelling. Coverage B — Other Structures. Coverage C — Personal Property.

Dwelling coverage is an important part of your homeowners or condo insurance policy. It covers your home's structure, installed fixtures, and permanently attached appliances. It helps you protect your residence structure and certain items attached to it.

A: Think of home insurance as a package of protection. Dwelling coverage is simply one part of that package. It covers the home itself —not the contents or land. Just the structure.

What's the difference between HO3 and HO6? The main difference between an HO3 policy for a single-family home and an HO6 condo insurance policy is that while an HO3 covers the physical structure of your home itself, an HO6 policy only covers what's inside the walls of your condo.

Therefore, you'll want to make sure your dwelling coverage limit is equal to the home's replacement value, which is based on things like the size of your home, local building costs per square foot, and the price of construction materials and labor.

Note: Dwelling coverage on standard policies typically won't protect against damage caused by floods, earthquakes, sewer backups, or lack of maintenance. Learn how flood insurance works and what to do if your home is damaged in an earthquake.

Another reason your dwelling coverage might be higher than the sale price is if the home is in an undesirable area, which lowered the market value. Certain homes that are older may also yield higher dwelling coverage.

If you have a structure on your property that isn't connected to your home and doesn't qualify as part of your dwelling — like a detached garage, fence or shed — it is likely not protected by dwelling coverage.

Coverage F, or “Medical Payments to Others” coverage is the component of your homeowners insurance policy which will help pay towards injuries sustained by someone who is not the insured, or a regular resident of the property.

Homeowners insurance policies generally cover destruction and damage to a residence's interior and exterior, the loss or theft of possessions, and personal liability for harm to others. Three basic levels of coverage exist: actual cash value, replacement cost, and extended replacement cost/value.

What is coverage C on a homeowners policy? ›

Coverage C is for personal property, also known as contents. Personal property refers to real, moveable stuff that you own. Furniture, appliances, clothing, electronics, and jewellery are all examples of personal property. Though many policies refer to this coverage as Coverage C, the name isn't universal.

The DP3 policy is typically used for rental properties and provides coverage only for the physical structure of the property. In contrast, the HO3 policy is designed for homes that are occupied by the owner and their family and provides coverage not only for the dwelling but also for personal property and liability.

Some common HO3 policy exclusions are:

Earth movement, such as an earthquake, sinkhole, and mudflow. Water damage from flood, sewer backup, or water seeping in through the foundation. Demolition of your home required by law to bring it to code.

The Higher Occupancy Homes (HOH) policy provides additional funds to renovate homes with a minimum of 4 bedrooms and 1,100 sq ft and provides priority in matching to Home Swap program participants with a family size of 5 or greater. HOH Eligibility.

HO-3 and HO-5 policies differ in how they cover your personal belongings. Both HO-3s and HO-5s exclude certain types of damage, such as flooding and earthquakes, from coverage. HO-5s are generally more expensive, as they provide broader financial protection.

Although there are many insurance policy types, some of the most common are life, health, homeowners, and auto. The right type of insurance for you will depend on your goals and financial situation. Consumer Financial Protection Bureau.

There are three types of property insurance coverage: replacement cost, actual cash value, and extended replacement costs.

Basic, Broad, and Special form are three common coverage forms when insuring property. Basic form is the most restrictive, while Special offers the greater level of protection.