HO5 Premier Homeowners Insurance Policy

The HO5 policy provides the broadest coverage available to homeowners in a standard form. Often considered a “premium” policy, HO5 covers your home, other structures, loss of use, and your personal property on an “all risk” or open perils basis.

All risk coverage means that unless a disaster or type of storm is specifically stated in the policy as being excluded, you’re covered.

One of the main differences between HO5 policies and the more common HO3 policies is that under an HO5 policy your personal property is covered on an all risk basis rather than the narrower coverage offered by named perils coverage.

Also, HO5’s may include increased coverage for jewelry and art as well as guaranteed replacement cost which would pay for the entire replacement of your home regardless of what it costs.

Typical exclusions for HO5 policies include the following.

  1. Enforcement of building codes and similar laws
  2. Earthquakes
  3. Flooding
  4. Power failures
  5. Neglect (meaning your failure to take reasonable steps to protect your property)
  6. War
  7. Nuclear hazard
  8. Intentional acts
  9. Freezing pipes and systems in vacant dwellings
  10. Damage to foundations or pavements from ice and water weight
  11. Theft from a dwelling under construction
  12. Vandalism to vacant dwellings
  13. Latent defects, corrosion, industrial smoke, pollution
  14. Settling, wear, and tear
  15. Pets, other animals, and pests
  16. Weather conditions that aggravate other excluded causes of loss
  17. Government and association actions
  18. Defective construction, design, and maintenance

Although the HO5 is a premium product, you will want to take the time to discuss what options are included and in particular make sure you understand which categories of property are covered by replacement cost insurance vs. actual cash value insurance.

Also, as with just about any standard homeowners insurance policy, the most common natural disaster, flooding, is not included. You need to purchase separate flood insurance to protect your home and your personal property from water damaged caused by a flood.

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