Homeowners and Dwelling Insurance
Homeowners and dwelling insurance tests the HO forms, Coverage A through F, perils, exclusions, and Minnesota endorsements. Expect questions on replacement cost, hail and wind deductibles, matching, ordinance or law, and water-related exclusions.
Coverage structure
Coverage A is the dwelling; B other structures; C personal property; D loss of use; E personal liability; F medical payments. HO-3 covers the dwelling on an open-peril basis and personal property on named perils; HO-5 is open peril for both. Replacement cost coverage pays to repair or replace without depreciation, usually after repairs are completed.
Exclusions and endorsements
Standard exclusions include earth movement, flood, water backup (limited endorsement available), mold (limited), vacancy, intentional loss, and business pursuits. Minnesota homeowners policies commonly use wind and hail deductibles stated as a percentage of Coverage A. Ordinance-or-law coverage addresses increased costs from building codes.
Worked example
An HO-3 insures a dwelling for $400,000 with replacement cost and a $2,500 deductible. An 80% requirement is $320,000, so no coinsurance penalty applies. A wind loss is $12,000 replacement cost; depreciation is $4,000. The initial ACV payment is $12,000 − $4,000 − $2,500 = $5,500. After the insured completes repairs, the $4,000 recoverable depreciation is released.
Traps
Do not pay replacement cost before completion unless the policy allows; do not overlook the percentage hail deductible; and do not treat matching of undamaged shingles as automatic without the endorsement or Minnesota guidance.