The Homeowners policy is the all-in-one package most people picture when they think of "home insurance." Unlike a dwelling policy, it bundles property coverage (Section I) with personal liability coverage (Section II) in a single contract. This guide explains the homeowners forms (HO-2 through HO-8), the coverages in each section, the perils covered, the key exclusions, and the endorsements you'll see most often.

What makes homeowners different

A homeowners (HO) policy is a packaged policy: it combines several coverages that would otherwise require separate contracts, and it almost always includes liability, which dwelling policies lack. It is designed for owner-occupants (with special forms for renters and condo owners) of one-to-four family homes. Eligibility generally assumes the insured lives in the home and that it is primarily residential.

The homeowners forms

Each form targets a different type of insured or level of coverage.

• HO-2 (Broad Form): covers the dwelling and personal property on a named-peril (broad) basis. A middle-tier option.
• HO-3 (Special Form): the most common homeowners policy. The dwelling and other structures are open-peril ("all-risk"), while personal property is named-peril (broad).
• HO-4 (Contents Broad Form / Renters): for tenants. Covers the renter's personal property and liability on a named-peril basis — there is no Coverage A dwelling, since the renter doesn't own the building.
• HO-5 (Comprehensive Form): the broadest standard form. Both the dwelling AND personal property are open-peril.
• HO-6 (Unit-Owners / Condo Form): for condominium owners. Provides limited building coverage (Coverage A) for interior improvements/betterments, plus personal property and liability.
• HO-8 (Modified Form / Older Home): for older homes where replacement cost would far exceed market value. Coverage is narrowed (often ACV / functional replacement and a limited peril list) so the home can be insured affordably.

Section I — Property coverages (A–D)

Section I covers the insured's property.

• Coverage A – Dwelling: the home itself and attached structures.
• Coverage B – Other Structures: detached structures (detached garage, shed, fence). Often about 10% of Coverage A.
• Coverage C – Personal Property: the insured's belongings, typically a percentage of Coverage A (often around 50%). Covered worldwide, and includes special sublimits for high-theft or high-value categories (jewelry, cash, firearms, silverware).
• Coverage D – Loss of Use: pays Additional Living Expense and Fair Rental Value when a covered loss makes the home uninhabitable.

Section II — Liability coverages (E–F)

Section II protects the insured against claims by other people.

• Coverage E – Personal Liability: pays for bodily injury or property damage to others for which the insured is legally liable, plus the cost of the insured's legal defense. This applies on and off the premises (e.g., the dog bites someone at the park).
• Coverage F – Medical Payments to Others: a no-fault coverage that pays reasonable medical expenses for someone (not an insured) injured on the premises, or by the insured's activities, regardless of fault. It is designed to settle small injuries quickly and discourage lawsuits.

Covered perils

• HO-2, HO-4, HO-6: named-peril (broad) coverage — the policy lists the covered causes of loss (fire, lightning, windstorm, hail, explosion, riot, aircraft, vehicles, smoke, vandalism, theft, falling objects, weight of ice/snow, water discharge, freezing, electrical surge, volcanic eruption).
• HO-3: dwelling/other structures are open-peril; personal property is named-peril (broad).
• HO-5: both dwelling and personal property are open-peril.
• HO-8: a reduced named-peril list appropriate for older homes.

Key exclusions

Even open-peril forms exclude major catastrophic and maintenance causes. Standard homeowners exclusions include:

• Flood (surface water) — insured separately under the national flood program.
• Earthquake / earth movement — added by endorsement or separate policy.
• War and nuclear hazard.
• Ordinance or law (cost to rebuild to current codes) — beyond a small built-in amount.
• Intentional loss, neglect, wear and tear, mold (limited), and vermin/insects.
• Power failure away from the premises and government action.

Common endorsements

• Scheduled Personal Property (Personal Articles): itemizes and insures high-value items (jewelry, furs, fine art) above the Coverage C sublimits, often on an open-peril, no-deductible basis.
• Personal Property Replacement Cost: pays contents claims without deducting depreciation.
• Inflation Guard: automatically raises Coverage A to keep pace with rebuilding costs.
• Water Back-Up and Sump Overflow: covers sewer/drain backup, normally excluded.
• Earthquake: adds quake coverage.
• Ordinance or Law: increases the amount available to rebuild to code.
• Identity Theft / Home Business / Permitted Incidental Occupancies: for specific needs.

Common exam traps

• HO-3 vs. HO-5: HO-3 = open-peril dwelling but named-peril contents; HO-5 = open-peril on both.
• HO-4 has no Coverage A: renters insure contents and liability, not the building.
• HO-6 building coverage is limited to the condo unit's interior/improvements.
• HO-8 is for older homes and typically pays ACV/functional replacement, not full replacement cost.
• Coverage C special limits: theft of jewelry, cash, and similar items has sublimits; schedule them for full protection.
• Medical Payments (F) is no-fault and applies to others, never to the insured's own injuries.
• Flood and earthquake are excluded in all standard forms.

Key terms at a glance

• Section I — property (Coverages A–D).
• Section II — liability (Coverages E–F).
• HO-3 — open-peril dwelling, named-peril contents (most common).
• HO-5 — open-peril on both dwelling and contents.
• HO-4 / HO-6 — renters / condo unit-owners.
• HO-8 — older homes, ACV/functional, limited perils.
• Coverage F — no-fault medical payments to others.

Quick recap

• A homeowners policy packages property (Section I) and liability (Section II) for owner-occupants.
• The forms range from HO-2 (broad) to HO-3 (open-peril dwelling, most common), HO-4 (renters), HO-5 (open-peril everything), HO-6 (condo), and HO-8 (older homes, ACV).
• Section I = Coverages A–D (Dwelling, Other Structures, Personal Property, Loss of Use); Section II = E–F (Personal Liability, Medical Payments to Others).
• Flood, earthquake, war, wear and tear, and ordinance/law are key exclusions.
• Scheduling, replacement cost, inflation guard, water back-up, and earthquake endorsements fill common gaps.