Types of Homeowners Insurance Policies
Homeowners insurance policies are sold in two forms – monoline and package policies. While a monoline policy offers only one type of coverage per policy, package policies offer a combination of different policies like liability, property insurance etc. When homeowners insurance is purchased as a package policy, it works out cheaper than a monoline policy. When you decide to approach Florida homeowners insurance companies, you should know the coverage options offered by different type of insurance policies.
Basic Policy
Each policy covers certain types of mishaps known as ‘perils’ and insures your home against these perils. The basic policy is known as the Homeowners-1 (HO-1) and offers coverage against perils like damage caused by fires, smoke, lightning, windstorms, theft, vandalism, physical injuries to anyone on your property, repairs of property damage caused by you and costs of related legal proceedings. Damage caused by civil riots or emergencies and explosions are also covered in this policy. If your home is unlivable due to damage, this policy will also account for your increased living expenses.
Broad Form Policy
The broad form policy covers all the perils listed in the basic policy and a few additional ones. In addition to the listed perils, the broad form policy or Homeowners-2 (HO-2) covers costs of damages caused by falling objects like ice or snow, water overflow caused by damaged pipelines of plumbing, air conditioning, sprinkler systems and heating.
Special Form Policy
This policy is the most popular policy offered by Florida homeowners insurance companies. Also known as Homeowners-3 (HO-3), it provides coverage for all damages caused to your home excluding a few perils that are specified in the particular policy. Perils like nuclear accidents, earthquakes, floods and war are usually excluded from this agreement. However, for an additional premium, you can include these perils in your policy.
Comprehensive Form Policy
Also known as the Homeowners-5 (HO-5), the comprehensive form policy covers the same list of perils as the special form policy, as well as damages caused to personal possessions. It comes with an exclusion list that mentions the perils that will not be covered on your home.
Market Value Policy
The market value policy covers the same perils as HO-1 and additionally covers the repair or replacement costs of the building. Florida homeowners insurance companies are not liable to pay any extra amount than necessary for the repairs. Also known as the Homeowners-8 (HO-8), this policy is recommended for older properties, the replacement costs for which exceed their market value.
Unit Owners Policy
This type of policy is used to protect the inner contents of apartments and condominiums, and also covers personal liabilities in cases of bodily injuries and damages to the property. The Unit Owners Policy is also known as Content Broad Form, Homeowners-4 (HO-4) or Tenants Policy.
All Florida homeowners insurance companies offer one or all of these insurance policies. You should conduct a thorough research to determine which policy will suit you and your home the best. You could also talk to your insurance agent to check if you are eligible for any additional discounts or coverage options to get the best deals.