Homeowners Policy
Structure
Homeowners is a package. Section I property: A Dwelling, B Other Structures (usually 10% of A), C Personal Property, D Loss of Use. Section II liability: E Personal Liability, F Medical Payments to Others. Forms: HO-3 (open peril on the dwelling, named peril on contents), HO-5 (open peril on both), HO-2 (broad named peril), HO-4 renters, HO-6 condo, HO-8 modified for older homes.
Special limits
Coverage C carries internal sublimits: money and securities (commonly $200), theft of jewelry and furs (commonly $1,500), theft of firearms and silverware, business property, and property of others. Off-premises personal property is covered worldwide at 10% of the Coverage C limit. Always check the form edition and declarations.
Section II mechanics
Coverage E pays sums the insured is legally obligated to pay for bodily injury, property damage, and personal injury (libel, slander, invasion of privacy). Coverage F pays medical expenses of others on a no-fault basis, typically $1,000-$5,000 per person, and does not apply to the named insured or regular residents.
Exclusions to know
Intentional acts, business pursuits, motor vehicle liability off the premises, watercraft above stated limits, aircraft, rental of the residence absent an endorsement, home day care, and damage to property owned by the insured.
Worked example: A neighbor's child trips on the insured's walkway and needs stitches. Coverage F pays the medical bill regardless of fault; if the parent sues, Coverage E defends and pays.
Trap: medical payments to others is not liability coverage - no negligence or lawsuit is needed - but the insured's own household is excluded.