Questions about Homeowners Insurance?
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When it comes to insuring your home you can’t afford to take chances.
We’re from Fort Worth, Texas and understand your concerns for severe weather causing damage to your home. We know that choosing the right insurance policy can be complicated and confusing. Let our office help you choose from the many types of homeowners insurance policies that are available. With the carefully selected companies we represent and vast knowledge of Texas homeowners insurance, we will provide you with the information needed to select the correct coverage for your home. Multiple discounts are available and increased when you combine your homeowners insurance with your auto insurance. The better we know you, the more we can do for you so give us a call today or submit your information online and we will work hard to earn you as a homeowners insurance customer.
Do You Have the Correct Insurance Coverage for Your Home?
Most Homeowners Policies in Texas Combine the Following Five Coverages
- Dwellings pays if your house is damaged or destroyed by a covered loss. It also pays for unattached structures and buildings, such as fences, detached garages, and storage sheds.
- Personal Property pays if the items in your house (such as furniture, clothing, and appliances) are stolen or damaged or destroyed by a covered loss.
- Liability provides $25,000 in coverage if you are sued and found legally responsible for someone else’s injury or property damage. You may be able to purchase up to $1 million in additional coverage.
- Medical Payments pays the medical bills of people hurt on your property. It might also pay for some injuries that happen away from your home — if your dog bites someone at the park, for instance. A basic homeowners policy pays $500 in medical bills, but you may buy up to $5,000 in medical payments coverage.
- Loss of Use pays your additional living expenses (housing, food, and other essential expenses) if you must temporarily move because of damage to your house from a covered loss. Your policy will pay either a percentage of the amount of your dwelling coverage (typically 10 to 20 percent) or for a specific period after the loss (such as 24 months).
There are Two Types of Homeowners Insurance Policies in Texas
- All-Risk Policies (also known as a comprehensive coverage or open perils coverage): These policies offer you broad protection and cover all causes of loss unless the policy specifically excludes them.
- Named Perils Policies (also known as specified perils coverage): These policies offer narrower protection than an all-risk policy and cover only the causes of loss specifically named in the policy.
Understanding Replacement Cost and Actual Cash Value
- Replacement Cost is what you would pay to rebuild or repair your home, based on current construction costs. Replacement cost is different from market value and does not include the value of your land. Ask your company if you are not sure how much it would cost to rebuild your house.
- Actual Cash Value is the replacement cost of your property minus depreciation. If your home is destroyed and you only have actual cash value coverage, you may not be able to completely rebuild.
Most Commonly Used Homeowners Policies in Texas
HOA: Basic Named Perils Policy
The HOA Home Policy is the most basic and simple home insurance protection. It is equivalent to the HO1 policy outside of Texas. The HOA policy will only protect you from 10 specific perils (a peril is an event or disaster that causes a loss or damage to your home or property. A few of the most common perils are fire, theft, wind, and hail). If something happens to your home other than these ten perils, you are not covered under the HOA. For a list of these ten perils, click here.
HOA+: Broad Named Perils Policy
The HOA+ Home Policy provides broader coverage than the HOA policy. It is equivalent to the HO2 policy in most states. Like the HOA, the HOA+ still lists every peril you are protected from, but the list adds six more perils. This protection covers your dwelling and your personal property. For a list of these sixteen perils, click here.
HOB: Basic Open Perils Policy
The HOB Home Policy is referred to as an open perils policy. That means instead of specifically listing the only perils you are protected from like the HOA or the HOA+, the HOB lists the perils your policy WON’T cover. If a peril isn’t listed as being excluded, your home is protected. HOB home protection is much broader than HOA or HOA+ coverage. This open perils coverage only applies to the home. The HOB is most similar to the HO3 policy, but is slightly better because it typically includes additional water damage protection that an HO3 doesn’t. With the HOB, your contents are protected from the same 16 perils that are listed in the HOA+ policy. The exclusions to the dwelling protection are provided by clicking here.
HO3: Basic Open Perils Policy
The HO3 Home Policy is a hybrid of an open peril policy and a named perils policy. This policy covers your dwelling for anything and everything that could possibly happen to it other than explicitly excluded events, while your contents are covered for the sixteen perils covered in the HOA+ policy. The exclusions to the dwelling protection are provided by clicking here.
The only real difference between the HO3 and the HOB is the type of water protection that comes standard with the policy. As you can see from exclusion 3 above, Water Damage is normally excluded from HO3 home owners policies.
Four types of water damage can be endorsed onto your policy
- Sudden & Accidental Discharge of Water – this is protection from water damage resulting from a pipe bursting.
- Water Backup – this is protection from water damage resulting if there is a backup in a sewer system, and water comes pouring out of your toilets and sinks into the house.
- Foundation Coverage – this is protection to your foundation if it has to be destroyed in order to fix a water problem in or under the foundation. This is typically only an important coverage if you would have to tear up the foundation to get to pipes. A good example of this is a slab foundation.
- Continual & Repeated Seepage – this is protection from water damage resulting from a slow leak in the home, which damages the home over time.
HOC: Full Open Perils Policy
The HOC Home Policy is full open perils on both the dwelling and contents. This means that your home is covered for anything and everything that could possibly happen to it, minus the same exclusions listed above in the HOB policy. The only significant difference between the HOC and the HOB is that the HOC will cover your contents for open perils, while the HOB covers your contents for the 16 perils listed above in the HOA+ policy. The HOC policy most closely resembles the HO5.
Information Provided by Lincoln Stevens — Marketing Director of Insurance Education Group
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