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Insurance · Homeowners Policies

What does a standard HO-3 (Special Form) homeowners policy cover?

Correct answer

Open perils (all risks) on the dwelling and other structures; named perils on personal property; loss of use; personal liability; medical payments to others

  1. A Named perils only
  2. B Open perils (all risks) on the dwelling and other structures; named perils on personal property; loss of use; personal liability; medical payments to others
  3. C Only liability
  4. D Only contents

Why this is the answer

The HO-3 (Special Form) is the most common homeowners policy. Coverage structure: Coverage A (Dwelling) and B (Other Structures) are written on open-perils basis — covers all risks except those specifically excluded; Coverage C (Personal Property) is named-perils — covers only specifically listed risks; Coverage D (Loss of Use) pays additional living expenses if the home is uninhabitable; Coverage E (Personal Liability) and F (Medical Payments to Others) cover liability claims. Common exclusions: flood, earthquake, war, nuclear hazard, intentional acts, neglect, ordinance/law, power failure, mold (with limited exceptions). HO-5 (Comprehensive) extends open-perils to personal property as well; HO-1 (Basic) and HO-2 (Broad) are older forms with limited coverage; HO-4 is renters; HO-6 is condo unit owner; HO-8 is older homes.
Source: NAIC Model Outline, HO-3 Coverage

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