With so many options available, choosing the right Homeowners policy can feel daunting. For example, what is the difference between HO3 and HO5 policies? Keep reading to discover the answer.
HO3 vs HO5 Policies: What Is the Difference?
The main difference between HO3 and HO5 policies is the type of coverage they provide. HO3 policies offer all-risks coverage for the building and named-perils coverage for the contents of the home. On the other hand, HO5 policies offer all-risk coverage for both the home and its contents.
In order to avoid confusion, keep in mind that HO3 policies are also known in Texas as HO-B policies, and HO5 are known as HO-C.
Now that we have reviewed all the basic definitions, let’s take a closer look to understand what the difference between HO3 and HO5 policies means for you.
What Is All-Risks Coverage?
In the insurance industry, the term “all-risks coverage” refers to a type of coverage that offers protection against all types of incidents unless they are specifically excluded from the policy.
The list of exclusions of a homeowners policy can vary depending on the carrier. Some common exclusions are:
- Earthquake
- Mold
- Mice
- Insects
- Flood
- Wear and tear
What Is Named-Perils Coverage?
While all-risks coverage shields you from all risks unless specifically excluded, named-perils policies do the opposite: they protect you only against the risks listed in your policy.
Some of the perils (or risks) covered by a named-perils policy usually include:
- Fire
- Lightning
- Smoke
- Windstorm
- Explosion
- Hail
- Vandalism
- Riot
- Theft
- Falling objects
- Weight of ice
- Accidental water discharge (in some cases)
HO3 vs HO5 Policies: Wrapping It Up
As we have seen, the difference between HO3 and HO5 policies is the type of coverage they provide to your home and its contents.
- HO3 (or HO-B in Texas): all-risks coverage for the building and named-perils coverage for the contents of your home.
- HO5 (or HO-C in Texas): all-risks coverage for both your home and its contents.
To learn more about homeowners insurance, be sure to check out our previous blog, What Is the Difference Between HO2 and HO3 Policies?
BZ Bee Insurance: Home Insurance in Texas
Looking for high-quality home insurance? At BZ Bee, we understand our clients’ needs and go out of our way to help you find coverage that meets your needs.
To get a free quote, just contact us by email (ayalamariaeugenia@yahoo.com) or telephone (832-729-8114), or fill out the contact form on this website.
