Homeowners Insurance

Do you ever wonder what your homeowner Insurance policy covers? Do you think you may be paying too much? We at Inshoragroup have the power to shop with several companies so we can ensure you get the best price for best coverage.

Homeowners Insurance Covers:

  • The structure of your home.
  • Your personal possessions.
  • The cost of additional living expenses if your home is damaged and you have to live elsewhere during repairs.
  • Your liability to others.

You need enough homeowner’s insurance to cover the cost of rebuilding your home at current construction costs. Don’t include the cost of the land. And don’t base your rebuilding costs on the price you paid for your home. The cost of rebuilding could be more or less than the price you paid or could sell it for today. For a quick estimate of the amount of homeowners insurance you need, multiply the total square footage of your home by local building costs per square foot. Standard home policies provide coverage for disasters such as damage due to fire, lightning, wind, hail, hurricane and theft. They do not cover floods, earthquakes or damage caused by lack of routine maintenance.

Texas Policy Form

When purchasing homeowners insurance policy, it is very significant to understand the policy form. Most people only compare the policy limits and deductibles and do not pay attention to the underlying policy form. There are many different policy forms you can purchase and the coverage vary significantly.

In Texas, most common forms are HOA, HOA+, HOB and HOC.

HOA: Basic Named Perils Policy:

The HOA Homeowners Insurance Policy is the most basic and simple home insurance protection. The HOA policy will only protect you from 10 specific perils (A peril is an event or disaster that causes a loss or damage to your home or property). This is a basic form and is referred to as a Named Peril policy. If something happens to your home other than these ten perils, you are not covered under the standard HOA.

The ten perils are:

  1. Fire or Lightning
  2. Windstorm or Hail
  3. Explosion
  4. Riot or Civil Commotion
  5. Aircraft
  6. Vehicles (unless caused by the insured)
  7. Smoke
  8. Vandalism or Malicious Mischief
  9. Theft (limit of liability on HOA is usually $1,000)
  10. Volcanic Eruption

HOA+: Broad Named Perils Policy

The HOA+ Homeowners Insurance Policy provides broader coverage than the HOA policy. Like the HOA, the HOA+ still lists every peril you are protected from, but the list adds six more perils. This protection covers your dwelling and your personal property. If something happens to your home other than these perils, you are not covered.

The sixteen perils are:

  1. Fire or Lightning
  2. Windstorm or Hail
  3. Explosion
  4. Riot or Civil Commotion
  5. Aircraft
  6. Vehicles (unless caused by the insured)
  7. Smoke
  8. Vandalism or Malicious Mischief
  9. Theft (limit of liability on HOA is usually $1,000)
  10. Volcanic Eruption
  11. Falling Objects
  12. Weight of Ice, Snow, or Sleet
  13. Accidental Discharge or Overflow of Water or Stream
  14. Sudden & Accidental Tearing Apart, Cracking, Burning, or Bulging
  15. Freezing
  16. Sudden & Accidental Damage from Artificially Generated Electric Current

HOB/HO3: Open Perils Policy

HOB Homeowners Insurance Policy is referred to as an open perils policy. That means instead of specifically listing the only perils you are protected from like the HOA or the HOA+, the HOB/HO3 lists the perils your policy will not cover. If a peril isn’t listed as being excluded, your home is protected. HOB/HO3 home protection is much broader than HOA or HOA+ coverage. This open perils coverage only applies to the home. The exclusions to the dwelling protection are listed below.

  1. Earth Movement
  2. Power Failure
  3. Neglect
  4. War
  5. Flood
  6. Nuclear Hazard
  7. Intentional Loss
  8. Government Action
  9. Mechanical Breakdown
  10. Collapse (some coverage may be provided in your policy)
  11. Mold, Fungus, or Wet Rot (some coverage may be provided in your policy)
  12. Smog, Rust, & Corrosion
  13. Smoke from Agricultural Smudging & Industrial Operations
  14. Dispersal, Discharge, Seepage of Pollutants
  15. Animals own by Insured
  16. Birds, Vermin, Rodents, Insects
  17. Wear & Tear, Deterioration
  18. Settling, Shrinking, Bulging, or Expanding (of bulkheads, foundations, pavement, patios, footings, floors, roofs, ceilings)

HOC/HO5: Full Open Perils Policy

The HOC/HO5 Homeowners Insurance Policy is full open perils on both the dwelling and contents. This means that your home is covered for anything and everything that could possibly happen to it, minus the same exclusions listed above in the HOB/HO3 policy. The only significant difference between the HOC/HO5 and the HOB/HO3 is that the former will cover your contents for open perils, while the later covers your contents for the 16 perils listed above in the HOA+ policy.

The next time you are shopping for Texas home insurance, hopefully you keep in mind that these will most likely be the types of policies you will come across. This information can be overwhelming and forms vary from company to company. Our recommendation is to contact our agency  for a free consultation. Good luck!