Maryland Property Casualty Test
(Homeowners) Questions and Answers
Latest
Characteristics & Purpose -
Comprehensive coverage designed to cover dwellings used primarily as homes.
Each policy must have personal property and personal liability coverage.
Standardized Homeowners Insurance Package Policy -
introduced by the Multi-Peril Insurance Conference in 1958. Every homeowner's
policy form must include coverage for property under Section 1 and personal liability
under Section 2. Section 1 contains 3 Cause of Loss forms.
Coverage Forms -
Under Homeowner's program there are 6 coverage forms. Each has a different
level of protection. Broader coverage may be obtained by paying higher premiums.
6 Types of Coverage Forms -
HO-2 Broad Form
HO-3 Special Form
HO-4 Contents Broad Form
HO-5 Comprehensive Form
HO-6 Condominium Form
HO-8 Modified Coverage Form
HO-2 Through HO-5 -
written only for owner occupant using dwelling for for private residence and not
vacation home. Main requirement is owner must occupy dwelling. Professional
occupancy allowed if 2 people or less and no retail sales. Dwelling may not contain
more than 4 families or more than 2 roomers or boarders. Building coverage is on a
replacement cost basis, only if building is insured for 80% or more replacement cost.
HO-2 (Broad Form) -
Provides protection for losses from limited named perils. Exclusions are;
- damage from water or steam if dwelling vacant for 60 days+
- driveways, fences and walks damaged from vehicle owned or operated by resident
- inside buildings damaged by rain, snow, sleet, sand, dust, unless wind or hail
caused damage first that created an opening.
- Inside buildings damaged by loss from falling objects, unless objects first damaged
the roof or an outside wall.
HO-3 (Special Form) -
protects dwelling and other structures on an open peril basis and personal
property for broad perils. Personal property on the HO-3 is same as HO-2--Broad
Form-Named Perils. With HO-3 vehicle damage to driveways, fences and walks is
covered regardless if it was caused by an insured or resident. Exclusions;
, Damage caused by freezing while dwelling was vacant, unoccupied or being
constructed unless insured took reasonable steps.
- Theft in or to dwelling under construction
- Gradual, preventable or expected losses from wear and tear, latent defect,
contamination, bulging, or expansion of foundations, pavements walls or floors.
- Faulty or defective planning, zoning, surveying or design.
Weather condition loss to the extent they contribute to causes found in general
exclusions such as flood or power failure.
HO-4 (Contents Broad Coverage) - Often called renter's policy -
Also called Tenant Broad Form which covers personal property for Broad perils.
Coverage is not for owner/occupant, only for tenant that resides in a rented dwelling
or an apartment.
HO-5 (Comprehensive Form) -
insures the dwelling, other structures on an open peril basis. Landlord furnishings
in a rented apartment or one held for rent is limited to $2,500 and is provided on a
named peril basis. Includes property under mysterious disappearance.
Mysterious Disappearance -
A disappearance of property that cannot be explained as to the location, time or
the manner of property loss.
HO-6 (Condominium Unit Owners)--(From the Walls In) -
Designed to cover the owner occupant of a condo. It also expands to insure parts
of the building like appliances and alternations that an insured is required to insure
because of their Condo Assoc. Agreement.
HO-6 Policy Under Coverage A (Dwelling) covers -
-Alterations appliances, fixtures and improvements within the residence
- Items of real property within residence
- Property of insured's responsibility under corporation or association of an property
owner's agreement.
- Structures owned by an insured, other than their residence, located at their
residence.
Exclusions;
- Land, including land on which residence premises, real property or structures are
located
- Structures rented or held for rental to any person that is not a tenant of dwelling.
Structures where business is conducted
- Structures used to store business property
- Property solely owned by insured or tenant of the dwelling.
HO-6 under Coverage C insures the following -
Personal property owned or used by insured while it is anywhere in the world
After a loss and at an insured's request, it will cover personal property owned by:
a. others while the property is on insured's premises
b. A guest or a residence employee if in insured's premises.
(Homeowners) Questions and Answers
Latest
Characteristics & Purpose -
Comprehensive coverage designed to cover dwellings used primarily as homes.
Each policy must have personal property and personal liability coverage.
Standardized Homeowners Insurance Package Policy -
introduced by the Multi-Peril Insurance Conference in 1958. Every homeowner's
policy form must include coverage for property under Section 1 and personal liability
under Section 2. Section 1 contains 3 Cause of Loss forms.
Coverage Forms -
Under Homeowner's program there are 6 coverage forms. Each has a different
level of protection. Broader coverage may be obtained by paying higher premiums.
6 Types of Coverage Forms -
HO-2 Broad Form
HO-3 Special Form
HO-4 Contents Broad Form
HO-5 Comprehensive Form
HO-6 Condominium Form
HO-8 Modified Coverage Form
HO-2 Through HO-5 -
written only for owner occupant using dwelling for for private residence and not
vacation home. Main requirement is owner must occupy dwelling. Professional
occupancy allowed if 2 people or less and no retail sales. Dwelling may not contain
more than 4 families or more than 2 roomers or boarders. Building coverage is on a
replacement cost basis, only if building is insured for 80% or more replacement cost.
HO-2 (Broad Form) -
Provides protection for losses from limited named perils. Exclusions are;
- damage from water or steam if dwelling vacant for 60 days+
- driveways, fences and walks damaged from vehicle owned or operated by resident
- inside buildings damaged by rain, snow, sleet, sand, dust, unless wind or hail
caused damage first that created an opening.
- Inside buildings damaged by loss from falling objects, unless objects first damaged
the roof or an outside wall.
HO-3 (Special Form) -
protects dwelling and other structures on an open peril basis and personal
property for broad perils. Personal property on the HO-3 is same as HO-2--Broad
Form-Named Perils. With HO-3 vehicle damage to driveways, fences and walks is
covered regardless if it was caused by an insured or resident. Exclusions;
, Damage caused by freezing while dwelling was vacant, unoccupied or being
constructed unless insured took reasonable steps.
- Theft in or to dwelling under construction
- Gradual, preventable or expected losses from wear and tear, latent defect,
contamination, bulging, or expansion of foundations, pavements walls or floors.
- Faulty or defective planning, zoning, surveying or design.
Weather condition loss to the extent they contribute to causes found in general
exclusions such as flood or power failure.
HO-4 (Contents Broad Coverage) - Often called renter's policy -
Also called Tenant Broad Form which covers personal property for Broad perils.
Coverage is not for owner/occupant, only for tenant that resides in a rented dwelling
or an apartment.
HO-5 (Comprehensive Form) -
insures the dwelling, other structures on an open peril basis. Landlord furnishings
in a rented apartment or one held for rent is limited to $2,500 and is provided on a
named peril basis. Includes property under mysterious disappearance.
Mysterious Disappearance -
A disappearance of property that cannot be explained as to the location, time or
the manner of property loss.
HO-6 (Condominium Unit Owners)--(From the Walls In) -
Designed to cover the owner occupant of a condo. It also expands to insure parts
of the building like appliances and alternations that an insured is required to insure
because of their Condo Assoc. Agreement.
HO-6 Policy Under Coverage A (Dwelling) covers -
-Alterations appliances, fixtures and improvements within the residence
- Items of real property within residence
- Property of insured's responsibility under corporation or association of an property
owner's agreement.
- Structures owned by an insured, other than their residence, located at their
residence.
Exclusions;
- Land, including land on which residence premises, real property or structures are
located
- Structures rented or held for rental to any person that is not a tenant of dwelling.
Structures where business is conducted
- Structures used to store business property
- Property solely owned by insured or tenant of the dwelling.
HO-6 under Coverage C insures the following -
Personal property owned or used by insured while it is anywhere in the world
After a loss and at an insured's request, it will cover personal property owned by:
a. others while the property is on insured's premises
b. A guest or a residence employee if in insured's premises.
