Dwelling, Homeowners, and Commercial Property Coverages
Homeowners forms
The HO program has two halves: Section I (property) and Section II (liability and medical payments to others). Coverages: A – dwelling, B – other structures, C – personal property, D – loss of use, E – personal liability, F – medical payments to others. Standard relationships: B = 10% of A, C = 50% of A, D = 30% of A, E = $100,000, F = $1,000, unless endorsed.
Forms to know: HO-2 (broad named perils), HO-3 (special/open perils on the dwelling, broad named perils on contents), HO-5 (special perils on both), HO-4 (tenants - contents and liability, no building), HO-6 (condo unit-owners - building items and betterments), HO-8 (older homes, functional replacement cost). The DP-1/DP-2/DP-3 dwelling forms are used for rental dwellings and homes that do not qualify for homeowners; DP forms have no liability coverage unless endorsed.
Traps in homeowners questions
Special limits sublimit theft of jewelry, furs, and watches; money; securities; silverware; and firearms - they are not the full Coverage C limit. Theft off-premises, business property in the home, and ordinance-or-law are limited or excluded. Section II medical payments to others pays regardless of fault but excludes the named insured and regular residents; liability excludes business pursuits and intentional acts.
Commercial property
The Building and Personal Property Coverage Form insures the building, business personal property, and personal property of others. Causes of loss forms step up: Basic, Broad, Special. Key endorsements and add-ons: agreed value, inflation guard, blanket insurance (one limit across locations), business income with extra expense, equipment breakdown, crime, builders risk, and inland marine for property in transit.
Worked example: HO-3 with Coverage A of $400,000 gives Coverage B $40,000, Coverage C $200,000, and Coverage D $120,000 - but a $10,000 ring stolen in a burglary is capped by the jewelry theft sublimit, not by the $200,000 contents limit.