Decoding the Common Homeowners Policy Forms in Texas
When choosing the homeowners insurance coverage that is right for your and your family, it can be confusing, especially here in Texas where companies can use national policy forms, or Texas specific policy forms. While it is your responsibility to ensure that your home is properly insured, the experienced staff at Texan Insurance will walk you through the different options so you can make educated choices to protect your home and family.
Texas companies use both the national policy forms such as the common HO3 as well as Texas specific forms HOA, HOA+, and HOB. Let’s compare the common policy forms in Texas (listed in order from least broad coverage, to the broadest coverage available):
HOA (Named Perils)
HOA is the most basic type of Texan homeowners insurance policy. HOA policies offer actual cash value coverage only, meaning settlements for damaged property are depreciated according to the item’s age and condition at the time of loss. The HOA policy is limited to these 8 specific Named Perils:
- Fire or lightning
- Sudden and Accidental Damage from Smoke
- Windstorm or hail (does not cover wind driven rain)
- Aircraft and Vehicles (not caused by insured or resident)
- Vandalism or malicious mischief
- Riot or civil commotion
- Theft (restrictions apply if off premises)
HOA+ (Expanded version of HOA)
The HOA+ Home Policy provides broader coverage than the HOA policy, but is still limited to the Named Perils listed in the policy. Loss settlements are typically replacement cost for the dwelling, and replacement cost coverage for the contents can be added. The forms are company specific, but we have included the common perils listed below:
- Falling objects
- Weight of ice, snow, or sleet
- Sudden & Accidental discharge/overflow of water or steam
- Sudden & Accidental tearing apart, cracking, burning or bulging of steam or water from water heating system
- Falling trees or limbs.
HO3 (National form Open Peril)
The HO3 is the most common policy form in the US, and provides coverage for your home on an Open Perils basis, with Named Peril coverage for your contents. Unlike the Named Peril policy forms, the Open Perils policy forms provide coverage for all sudden and accidental damage except the items specifically excluded, or otherwise limited. Notable exclusions are limited water discharge (no seepage or leakage or water back up), flood, and earth movement.
HOB (Texas form Open Peril)
The HOB is similar to the HO3 policy, as it also provides coverage for your home on an Open Perils basis; however it provides additional water damage protection that an HO3 does not provide. While this policy form has declined in popularity with companies, as many companies have opted to provide the less broad HO3 form. When available, the HOB policy form provides excellent value for the coverage being provided.
As you can see, there are many options to consider when choosing protection for your home. The right partner will help you consider all the factors, and choose the homeowners insurance that makes the most sense for you and your family.
Contact Texan Insurance today to review your current homeowners insurance needs.