Homeowners Insurance Flashcards

Which section of a standard homeowners policy (HO-3) covers the policyholder's personal property worldwide?

Answer: Coverage C – Personal Property

Coverage C in the HO-3 form covers the insured's personal property anywhere in the world, subject to policy limits.

An HO-3 policy's Coverage A covers the dwelling on an open-perils basis. What does 'open perils' mean?

Answer: All perils except those specifically excluded are covered

Open perils (also called all-risk) means coverage applies to all causes of loss except those specifically excluded in the policy.

Under a standard homeowners policy, which coverage pays for additional living expenses if the home becomes uninhabitable due to a covered loss?

Answer: Coverage D

Coverage D – Loss of Use pays for additional living expenses (hotel, meals) when the insured cannot live in the home because of a covered peril.

What DC-specific peril is NOT covered under a standard homeowners policy and typically requires a separate federal policy?

Answer: Flood

Flood damage is excluded from standard homeowners policies and is typically covered through the National Flood Insurance Program (NFIP).

Which homeowners policy form provides the broadest coverage and is typically used for owner-occupied dwellings?

Answer: HO-3 (Special Form)

HO-3 is the most commonly sold homeowners policy and provides the broadest coverage—open perils on the dwelling and named perils on personal property.

What is the purpose of an umbrella liability policy that a DC homeowner might purchase?

Answer: To provide excess liability coverage above the limits of underlying home and auto policies

An umbrella policy provides additional liability protection above and beyond the limits of the homeowners and auto liability policies.