Homeowners and Dwelling Policies
Choosing the form
Homeowners forms cover both property and liability: HO-2 (broad form), HO-3 (special form on the dwelling, broad on personal property), HO-5 (comprehensive), HO-8 (modified for older homes). HO-4 covers tenants' personal property and liability; HO-6 covers condo unit owners. Dwelling policies (DP-1, DP-2, DP-3) cover the building and personal property of a residence but provide no liability coverage - a classic exam distinction.
Coverages A through F
A = dwelling; B = other structures; C = personal property; D = loss of use (additional living expense or fair rental value); E = personal liability; F = medical payments to others. Coverage D is a percentage of Coverage A, and Coverage C is typically 50% of Coverage A on homeowners forms. Special limits cap categories such as money, securities, jewelry theft, silverware theft, business property, and electronic equipment in vehicles. These limits are sublimits inside Coverage C, not extra insurance.
Exclusions and conditions
Common exclusions: earth movement, flood, water backup (usually limited endorsement), ordinance or law, intentional loss, neglect, business use, and animals or motor vehicles. Conditions include duties after loss, appraisal, and the mortgage clause.
Worked example: $8,000 of jewelry is stolen; the homeowners form limits theft of jewelry to $1,500. The insured recovers $1,500 less the deductible - not $8,000. To close the gap, schedule the jewelry.
Traps
Watch for tenants (HO-4) and condo owners (HO-6) in the fact pattern, and for the question asking which form covers a rental dwelling - that is a dwelling policy, with no liability unless endorsed.