Why are there separate coverage types for your physical home and your belongings?
Since my belongings are all stored in my house, I don't understand the need for different coverage types.
There are separate coverage types for your dwelling and your personal property so that you can get the coverage that best suits your needs. The standard homeowners policy, also known as an HO3, will cover the dwelling and other structures (the house and things like sheds and garages) with open-peril coverage. This means it is covered for any loss except for whatever is excluded under the policy.
However, personal property inside the house is covered for named perils — those perils listed as covered under the policy — for actual cash value. Replacement cost coverage can be added by paying for an extra endorsement on the policy.
If you feel like your personal property has a higher-than-standard value, you may want to look into an HO5 policy. Both the HO3 and HO5 are very similar, but an HO5 provides open-peril coverage for your personal property and increased coverage limits for things like jewelry. Replacement cost for personal property also comes with this policy, but HO5 policies tend to be much more expensive and might not be the best financial choice for some people.
If you are unsure which is best for you and your home, talk with your insurance agent.
Did this answer help you?
Ask us a question by email and we will respond within a few days.
Have a different question?
You can meet us at our office and discuss the details of your question.
Read advice from car experts at Jerry
Browse by topics
What others are asking
Will my uninsured motorist coverage pay for my passenger's medical bills?
"I was rear-ended and not at fault in an accident. My passenger hit their head and had to go to the emergency room. The at-fault driver doesn't have insurance. My insurance said they would pay up to a certain amount for the medical bills, but I'd still owe $1,500. I have uninsured motorist coverage; would this apply?"
May 10, 2021
Why won't the other driver’s insurer pay for costs upfront after an accident?
I got into an accident and the other driver is at fault. This driver's insurance company wants me to absorb the costs for repairs and a rental car first. They say they'll reimburse me later. But I don't want to wait for reimbursement. Why won’t this insurer pay upfront?
Mar 12, 2021
How long do I have to return a car to a dealer?
"I bought a Kia two days ago and I’m already regretting it since I felt pressured into buying. How many days do I have to return a car to a dealer? "
Apr 09, 2021