Homeowners insurance is an essential insurance policy for anyone who owns residential property. When the unexpected happens, the financial loss can be devastating, especially since your home is one of the biggest investments you have in life. But with homeowners insurance, you can provide financial protection for your property and be compensated for any repairs or construction work you need to have your home restored.
There are several types of homeowners insurance in South Dakota. They each provide varying coverages for residential properties. In the local insurance industry, these classifications are called forms. Read on to learn about some of the different forms available for homeowners in the state.
Basic Form (HO1)
This form is the most basic type of homeowners insurance most companies offer. It insures the structure of your dwelling, as well as your personal property, which refers to things found in your home, such as furniture and clothing.
The Basic Form in South Dakota provides property insurance coverage against specific natural calamities, namely lighting, hail, and windstorms. It also covers damage caused by fires, explosions, acts of vandalism, and riots, in addition to any destruction that is a result of vehicular and aircraft accidents. These hazards are the only ones covered in the basic form as they can cause serious financial hardship to the homeowner.
Home Policy Form (HO2)
The Home Policy Form, commonly known as the broad form, provides broader coverage than a Basic Form. It protects your property from the same perils HO1 covers, along with a few other calamities.
With an HO2 policy, your home is protected against damage caused by faulty electrical equipment. It is also covered if it sustains damage or collapses because of the weight of accumulated ice and snow or contact with failing trees. This form even includes protection for steam and water damage, although it does not include destruction caused by flooding.
Special Form (HO3)
The HO3 provides the most extensive coverage for a residential property. It is considered an open-peril policy, as it offers protection against losses caused by almost all kinds of accidents and calamities, excluding specified situations.
Generally, this form does not cover damage caused by earthquakes, landslides, floodwater, surface water, sewer backups, and tidal waves. HO3 will also not protect your home against neglect, nuclear hazards, war, new ordinances, and intentional acts. The protection provided for your personal property is the same as that of HO2 and certain named perils in the policy.
These are just a few of the forms of homeowners insurance in South Dakota. Get in touch with Farmers Union Insurance to learn more about the other types of homeowners insurance.
