What Is a HO-3 Policy and What Does It Cover?

The HO-3 is the most common homeowners insurance policy, and it uses a broad all-risk approach for the dwelling and a named-peril approach for your belongings. It covers the structure against any cause of loss except those the policy excludes, while personal property is covered only against the specific perils listed.

For the dwelling, the HO-3 is an open peril policy. That means your house and attached structures are covered against any cause of loss unless the policy specifically excludes it. Common exclusions include flood, earthquake, and damage from neglect or lack of maintenance.

Because the coverage is so broad, the HO-3 is the standard choice for most homeowners. It protects the structure, other structures on the property, personal property, loss of use, and liability in one policy.

Personal property under an HO-3 is covered only against named perils, which are the causes listed in the policy. Those typically include fire, theft, wind, hail, lightning, and a set of other specific events. If something happens to your belongings that is not on that list, it is not covered.

For most Pennsylvania homeowners the HO-3 is a solid, well-rounded foundation. Just remember it does not cover flood, so in flood-prone areas of the region you may still need a separate flood policy to fill the gap.