For Speakers: Renters/homeowners insurance outline

TOOLS FOR CLASSROOM USE

Note that renters/homeowners insurance is provided as a “package.”

STANDARD PARTS OF A POLICY
YOUR THINGS:
  • House and outbuildings (not applicable for renters)
  • Personal possessions
  • Additional living expense
YOUR ACTIONS:
  • Liability for injury
  • Liability for property damage
  • Medical payments
  • Damage to property of others
  • Exclusions
TYPES OF HOMEOWNERS POLICIES
The homeowners forms available from most companies are:

  • Homeowners 2 (the Broad form) – Covers against loss by fire, lightning, windstorm, hail, explosion, riot, civil commotion, aircraft or non-owned vehicle damage, smoke, glass breakage, vandalism, burglary, robbery and theft, and volcanic eruption. It also provides protection for: damage from falling objects; weight of ice, snow and sleet; sudden and accidental tearing apart, cracking, burning or bulging of a steam or hot water heating system (or appliance for heating water); accidental discharge, leaking or overflow of water or steam from within a plumbing, heating or air conditioning system and domestic appliances; and sudden and accidental injury from artificially generated currents to electrical appliances, devices, fixtures and wiring.
  • Homeowners 3 (the “Special” form) – Offers the same protection as the Homeowners 2. In addition, it broadens the coverage to an “open-perils” basis for building and other structures on the property, Under an “open-perils” policy a peril is covered unless the policy specifically excludes that peril. The personal property coverage portion is not open-perils but is the same as provided under Homeowners 2. It can be provided by endorsement.
  • Homeowners 4 (the “Tenants” form) – Policy for renters. It covers personal property against the same perils as Homeowners 2. It also provides coverage for additional living expenses.
  • Homeowners 6 (the “Condominium” form) – A policy created to cover the special needs of condominium owners. It covers loss of personal property, building additions and alterations inside the owner’s individual unit. A variety of endorsements are available to protect the owner’s interest in the common property of the condominium association and to insure against any liability created by the unit owner’s share in the common ownership.
  • Homeowners 8 (the “Modified Coverage” form) – A homeowners insurance policy designed to aid the owner-occupied older home whose replacement cost far exceeds the property’s market value. The
HO 8 policy provides varying methods of loss payment depending on whether the damaged or destroyed building is repaired or replaced. The policy insures the dwelling and other structures on the premises and personal property against loss by fire or lightning, windstorm or hail, explosion, riot, civil commotion, vandalism or malicious mischief, falling aircraft, vehicle damage, smoke, theft (from within premises only)
and glass breakage. Also includes personal liability coverage and medical payments coverage for crashes occurring on the premises to persons other than residents.
SUPPLEMENTARY COVERAGES
Three supplementary coverages included in all homeowner forms are: Fire department service charge, debris removal and credit card theft.
SPECIAL LIMITS
Certain types of personal property covered by the homeowners policy are limited to specific amounts per loss. Limits may vary with individual companies and policies. Check your policy for limits on such items as money, securities, watercraft, jewelry, furs, guns, etc.
POLICY ENDORSEMENTS
Policy endorsements modify or extend specific coverages provided by the policy under certain conditions. They are readily available by insurers for an additional charge. Examples include replacement cost, backup of sewers and drains, earthquake insurance, etc.
SETTLING A HOMEOWNERS INSURANCE CLAIM