300 QUESTIONS AND ANSWERS
1. Q: What does the HO-3 homeowners policy cover for the dwelling? A:
HO-3 provides open perils coverage for the dwelling, meaning it covers all risks
except those specifically excluded.
2. Q: What is the difference between HO-1 and HO-8 policies? A: HO-1
provides basic named perils coverage, while HO-8 is designed for older homes
and provides actual cash value coverage with limited perils.
3. Q: What is Coverage A in a homeowners policy? A: Coverage A is
dwelling coverage that protects the structure of the home and attached
structures.
4. Q: What percentage of Coverage A does Coverage B typically provide?
A: Coverage B (Other Structures) typically provides 10% of Coverage A limits.
5. Q: What is Coverage C in homeowners insurance? A: Coverage C is
personal property coverage that protects the insured's belongings inside the
home.
6. Q: What percentage of Coverage A does Coverage C usually provide? A:
Coverage C typically provides 50% of Coverage A limits for personal property.
7. Q: What is Coverage D in homeowners policies? A: Coverage D is Loss of
Use coverage that pays for additional living expenses when the home is
uninhabitable due to a covered loss.
8. Q: What does Coverage E provide in homeowners insurance? A:
Coverage E provides personal liability coverage, typically $100,000 to
$500,000 or more.
9. Q: What is Coverage F in homeowners policies? A: Coverage F is Medical
Payments to Others coverage, typically $1,000 to $5,000 per person.
,10. Q: What is the standard deductible for homeowners insurance? A:
Standard deductibles range from $500 to $2,500, with $1,000 being common.
11. Q: What is replacement cost coverage? A: Replacement cost coverage
pays to repair or replace damaged property with new property of like kind and
quality without deducting for depreciation.
12. Q: What is actual cash value coverage? A: Actual cash value coverage
pays replacement cost minus depreciation for the age and condition of the
property.
13. Q: What is the coinsurance clause in homeowners insurance? A: The
coinsurance clause requires the insured to carry coverage equal to at least 80%
of the replacement cost of the dwelling.
14. Q: What happens if a homeowner is underinsured under the
coinsurance clause? A: The insured becomes a coinsurer and must pay a
portion of any loss proportionate to the amount of underinsurance.
15. Q: What is a named perils policy? A: A named perils policy only covers
losses caused by perils specifically listed in the policy.
16. Q: What is an open perils policy? A: An open perils policy covers all
causes of loss except those specifically excluded.
17. Q: What are the basic perils covered in most homeowners policies? A:
Fire, lightning, windstorm, hail, explosion, riot, aircraft, vehicles, smoke,
vandalism, theft, and volcanic eruption.
18. Q: What is typically excluded from homeowners coverage? A: Flood,
earthquake, war, nuclear hazard, intentional acts, neglect, and normal wear and
tear are typically excluded.
19. Q: What is the difference between HO-4 and HO-6 policies? A: HO-4 is
renters insurance covering personal property and liability; HO-6 is condo
insurance covering personal property, improvements, and liability.
20. Q: What does the personal property replacement cost endorsement do?
A: It changes personal property coverage from actual cash value to replacement
cost coverage.
21. Q: What is scheduled personal property coverage? A: It provides higher
limits and broader coverage for specific valuable items like jewelry, art, or
collectibles.
, 22. Q: What is the purpose of a personal umbrella policy? A: It provides
additional liability coverage above the limits of underlying homeowners and
auto policies.
23. Q: What is water damage coverage in homeowners policies? A: It covers
sudden and accidental discharge of water from plumbing, heating, or air
conditioning systems, but excludes flood and seepage.
24. Q: What is the difference between flood and water damage? A: Flood is
surface water from external sources (excluded); water damage is from internal
plumbing systems (covered).
25. Q: What is ordinance or law coverage? A: It covers the additional cost to
rebuild to current building codes when local ordinances require upgrades.
26. Q: What is the homeowners liability coverage trigger? A: Liability
coverage is triggered by bodily injury or property damage for which the insured
becomes legally liable.
27. Q: What does medical payments coverage pay for? A: It pays medical
expenses for others injured on the insured's property, regardless of fault.
28. Q: What is the difference between Coverage E and Coverage F? A:
Coverage E is liability coverage requiring legal liability; Coverage F is medical
payments without regard to fault.
29. Q: What is identity theft coverage? A: It reimburses expenses incurred to
restore identity and credit after identity theft, including legal fees and lost
wages.
30. Q: What is service line coverage? A: It covers repair or replacement of
underground utility lines from the street to the home.
31. Q: What is home business coverage? A: It provides limited coverage for
business property and liability exposures conducted from the home.
32. Q: What is the mortgage clause in homeowners insurance? A: It protects
the mortgage lender's interest in the property by naming them as an additional
insured.
33. Q: What is vacancy clause in homeowners policies? A: It suspends or
reduces coverage if the home is vacant for more than 30-60 consecutive days.
34. Q: What is the debris removal coverage? A: It pays to remove debris of
covered property damaged by a covered peril, typically up to 25% of the loss.
1. Q: What does the HO-3 homeowners policy cover for the dwelling? A:
HO-3 provides open perils coverage for the dwelling, meaning it covers all risks
except those specifically excluded.
2. Q: What is the difference between HO-1 and HO-8 policies? A: HO-1
provides basic named perils coverage, while HO-8 is designed for older homes
and provides actual cash value coverage with limited perils.
3. Q: What is Coverage A in a homeowners policy? A: Coverage A is
dwelling coverage that protects the structure of the home and attached
structures.
4. Q: What percentage of Coverage A does Coverage B typically provide?
A: Coverage B (Other Structures) typically provides 10% of Coverage A limits.
5. Q: What is Coverage C in homeowners insurance? A: Coverage C is
personal property coverage that protects the insured's belongings inside the
home.
6. Q: What percentage of Coverage A does Coverage C usually provide? A:
Coverage C typically provides 50% of Coverage A limits for personal property.
7. Q: What is Coverage D in homeowners policies? A: Coverage D is Loss of
Use coverage that pays for additional living expenses when the home is
uninhabitable due to a covered loss.
8. Q: What does Coverage E provide in homeowners insurance? A:
Coverage E provides personal liability coverage, typically $100,000 to
$500,000 or more.
9. Q: What is Coverage F in homeowners policies? A: Coverage F is Medical
Payments to Others coverage, typically $1,000 to $5,000 per person.
,10. Q: What is the standard deductible for homeowners insurance? A:
Standard deductibles range from $500 to $2,500, with $1,000 being common.
11. Q: What is replacement cost coverage? A: Replacement cost coverage
pays to repair or replace damaged property with new property of like kind and
quality without deducting for depreciation.
12. Q: What is actual cash value coverage? A: Actual cash value coverage
pays replacement cost minus depreciation for the age and condition of the
property.
13. Q: What is the coinsurance clause in homeowners insurance? A: The
coinsurance clause requires the insured to carry coverage equal to at least 80%
of the replacement cost of the dwelling.
14. Q: What happens if a homeowner is underinsured under the
coinsurance clause? A: The insured becomes a coinsurer and must pay a
portion of any loss proportionate to the amount of underinsurance.
15. Q: What is a named perils policy? A: A named perils policy only covers
losses caused by perils specifically listed in the policy.
16. Q: What is an open perils policy? A: An open perils policy covers all
causes of loss except those specifically excluded.
17. Q: What are the basic perils covered in most homeowners policies? A:
Fire, lightning, windstorm, hail, explosion, riot, aircraft, vehicles, smoke,
vandalism, theft, and volcanic eruption.
18. Q: What is typically excluded from homeowners coverage? A: Flood,
earthquake, war, nuclear hazard, intentional acts, neglect, and normal wear and
tear are typically excluded.
19. Q: What is the difference between HO-4 and HO-6 policies? A: HO-4 is
renters insurance covering personal property and liability; HO-6 is condo
insurance covering personal property, improvements, and liability.
20. Q: What does the personal property replacement cost endorsement do?
A: It changes personal property coverage from actual cash value to replacement
cost coverage.
21. Q: What is scheduled personal property coverage? A: It provides higher
limits and broader coverage for specific valuable items like jewelry, art, or
collectibles.
, 22. Q: What is the purpose of a personal umbrella policy? A: It provides
additional liability coverage above the limits of underlying homeowners and
auto policies.
23. Q: What is water damage coverage in homeowners policies? A: It covers
sudden and accidental discharge of water from plumbing, heating, or air
conditioning systems, but excludes flood and seepage.
24. Q: What is the difference between flood and water damage? A: Flood is
surface water from external sources (excluded); water damage is from internal
plumbing systems (covered).
25. Q: What is ordinance or law coverage? A: It covers the additional cost to
rebuild to current building codes when local ordinances require upgrades.
26. Q: What is the homeowners liability coverage trigger? A: Liability
coverage is triggered by bodily injury or property damage for which the insured
becomes legally liable.
27. Q: What does medical payments coverage pay for? A: It pays medical
expenses for others injured on the insured's property, regardless of fault.
28. Q: What is the difference between Coverage E and Coverage F? A:
Coverage E is liability coverage requiring legal liability; Coverage F is medical
payments without regard to fault.
29. Q: What is identity theft coverage? A: It reimburses expenses incurred to
restore identity and credit after identity theft, including legal fees and lost
wages.
30. Q: What is service line coverage? A: It covers repair or replacement of
underground utility lines from the street to the home.
31. Q: What is home business coverage? A: It provides limited coverage for
business property and liability exposures conducted from the home.
32. Q: What is the mortgage clause in homeowners insurance? A: It protects
the mortgage lender's interest in the property by naming them as an additional
insured.
33. Q: What is vacancy clause in homeowners policies? A: It suspends or
reduces coverage if the home is vacant for more than 30-60 consecutive days.
34. Q: What is the debris removal coverage? A: It pays to remove debris of
covered property damaged by a covered peril, typically up to 25% of the loss.
