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HO2 Vs HO3 Info
- Thread starter rolox1
- Start date
- 226
I will have to ask my underwriter on that..but since HO3 is a named peril form spilling bleach would not be a covered peril correct? HO-5 is an all peril form with named exclusions..i see your point on it being part of the dwelling but isn't cause of loss the important factor?
HO3 will have special cause of loss on building and broad form on contents.
- 648
Good answer! I don't think I have an HO2 on the books. I don't think I have written a PD/DW 1 or 2 in years.
I have list of examples of claims covered by the ISO HO3 but not the HO2. If I don't forget, I'll post it first chance I get. But be wary of generalized lists because many HO policies are different and the losses on such lists might not apply to that insured's policy or the carrier may interpret it differently.
I've seen carriers deny paint spills on carpet, citing their HO3 pollution exclusion. On the other hand, in one instance, a paint spill was covered under an HO2 as damage caused by a falling object. If you can show coverage on an HO2, you've established coverage on an HO3. For example, spray paint damage by vandals is covered by an ISO HO2 which covers V&MM and has no pollution coverage; therefore, according to ISO, it's covered by the HO3.
I've seen carriers deny paint spills on carpet, citing their HO3 pollution exclusion. On the other hand, in one instance, a paint spill was covered under an HO2 as damage caused by a falling object. If you can show coverage on an HO2, you've established coverage on an HO3. For example, spray paint damage by vandals is covered by an ISO HO2 which covers V&MM and has no pollution coverage; therefore, according to ISO, it's covered by the HO3.
Thanks for the reminder. Below is a list of things that might be covered by an open perils policy vs. a named perils policy. Whether it is or isn't, of course, depends on the specific policies. For example, the 2000 edition of the ISO HO-3 most likely covers skunk discharges but the 2011 edition probably does not. Be wary when providing such lists to customers or prospects in that they might assume that THEIR policy covers all these things while they are simply examples of what MIGHT be covered by an open perils form vs. specified perils.
Open Perils Coverage Advantages
A basic principle of insurance is that "open perils" coverage provides better protection to the insured than does "named peril" coverage. This holds true for both homeowners policies as well as commercial property policies. If a customer were to ask for specific examples of claims covered under the "open perils" form that would not be covered under the typical "named peril" form, would you have a list handy to show them? While some of the examples pertain exclusively to homeowners risks, many apply to both personal and commercial property insurance policies. By the way, many of these examples are from actual claims.
• Rain enters an open window causing damage to carpet, furniture, and your black velvet Elvis painting collection.
• Theft of personal property in a portion of the residence rented to others.
• Windstorm damage to watercraft not inside fully enclosed building (a MAJOR source of claims to boats at marinas) like Spielberg's $200 million boat.
• Theft of watercraft away from premises.
• Mysterious disappearance of personal property (that you know your daughter's worthless boyfriend stole, but you can't prove it).
• Damage to interior of a building by falling object with no exterior damage.
• Theft of trailers away from premises (e.g., your camper converted UHaul trailer while at Dub's Trailer Park, RV Camp, and Snake Emporium near Opp, Alabama).
• Damage to a falling object itself, such as a chandelier.
• Seepage of water around windows causing damage to furniture and/or carpet but, thank God, not the Elvis paintings.
• Power surge to tubes, transistors, and electronic components.
• Waterbed bursts…adjuster completes Loss Notice with admiring smirk as you explain how it happened.
• Scorching.
• Theft of personal property at secondary residence while the insured is not living there (e.g., your converted UHaul trailer "summer home" situated at Dub's Trailer Park, RV Camp, and Snake Emporium near Opp, Alabama).
• Spillage, such as dropping tomato sauce on white carpet.
• Collapse of floor due to weight of objects, animals or people. (Insurer can subrogate against Jenny Craig and PetSmart.)
• Skunk discharges inside building.
• Foreign objects dropped into and damaging plumbing systems. (We'll leave specific examples to your imagination.)
• Lawnmower throws rock through window.
• Non-malicious acts of children, otherwise known as "You Little B*st*rd!" coverage in Mississippi, West Virginia, and Idaho.
• Dropping items, such as a personal computer.
• Nail polish on couch and chair. Your wife doesn't use nail polish, so….
• Murder in house, significant damage from blood.
• Shotgun damage to building and contents (at least one court case said it was covered as an "explosion" on named perils coverage).
• Damage from fighting (including fighting with shotguns).
• Neighbor's stray goat enters house, eats carpet and couch. Shotgun not immediately available or there would be a question about number of occurrences and deductibles.
• Aquarium breaks, water floods room. Elvis paintings survive.
• Jewelry --- stone disappears from setting.
• Luggage lost by airlines (if your last name is Foxworthy, it covers all those Piggly Wiggly bags and duct-taped coolers).
• Property sent through mail never arrives.
• Personal property dropped overboard from boat. Example: Natalie Wood.
• Lawn sprinkler damage through open window. No problem with Elvis paintings as they are now safely stored in a bank vault.
Includes material copyrighted 1999-2015 by "The G5".
Open Perils Coverage Advantages
A basic principle of insurance is that "open perils" coverage provides better protection to the insured than does "named peril" coverage. This holds true for both homeowners policies as well as commercial property policies. If a customer were to ask for specific examples of claims covered under the "open perils" form that would not be covered under the typical "named peril" form, would you have a list handy to show them? While some of the examples pertain exclusively to homeowners risks, many apply to both personal and commercial property insurance policies. By the way, many of these examples are from actual claims.
• Rain enters an open window causing damage to carpet, furniture, and your black velvet Elvis painting collection.
• Theft of personal property in a portion of the residence rented to others.
• Windstorm damage to watercraft not inside fully enclosed building (a MAJOR source of claims to boats at marinas) like Spielberg's $200 million boat.
• Theft of watercraft away from premises.
• Mysterious disappearance of personal property (that you know your daughter's worthless boyfriend stole, but you can't prove it).
• Damage to interior of a building by falling object with no exterior damage.
• Theft of trailers away from premises (e.g., your camper converted UHaul trailer while at Dub's Trailer Park, RV Camp, and Snake Emporium near Opp, Alabama).
• Damage to a falling object itself, such as a chandelier.
• Seepage of water around windows causing damage to furniture and/or carpet but, thank God, not the Elvis paintings.
• Power surge to tubes, transistors, and electronic components.
• Waterbed bursts…adjuster completes Loss Notice with admiring smirk as you explain how it happened.
• Scorching.
• Theft of personal property at secondary residence while the insured is not living there (e.g., your converted UHaul trailer "summer home" situated at Dub's Trailer Park, RV Camp, and Snake Emporium near Opp, Alabama).
• Spillage, such as dropping tomato sauce on white carpet.
• Collapse of floor due to weight of objects, animals or people. (Insurer can subrogate against Jenny Craig and PetSmart.)
• Skunk discharges inside building.
• Foreign objects dropped into and damaging plumbing systems. (We'll leave specific examples to your imagination.)
• Lawnmower throws rock through window.
• Non-malicious acts of children, otherwise known as "You Little B*st*rd!" coverage in Mississippi, West Virginia, and Idaho.
• Dropping items, such as a personal computer.
• Nail polish on couch and chair. Your wife doesn't use nail polish, so….
• Murder in house, significant damage from blood.
• Shotgun damage to building and contents (at least one court case said it was covered as an "explosion" on named perils coverage).
• Damage from fighting (including fighting with shotguns).
• Neighbor's stray goat enters house, eats carpet and couch. Shotgun not immediately available or there would be a question about number of occurrences and deductibles.
• Aquarium breaks, water floods room. Elvis paintings survive.
• Jewelry --- stone disappears from setting.
• Luggage lost by airlines (if your last name is Foxworthy, it covers all those Piggly Wiggly bags and duct-taped coolers).
• Property sent through mail never arrives.
• Personal property dropped overboard from boat. Example: Natalie Wood.
• Lawn sprinkler damage through open window. No problem with Elvis paintings as they are now safely stored in a bank vault.
Includes material copyrighted 1999-2015 by "The G5".
Who even writes HO2 policies anymore? Besides, customers don't even know what a HO2 policy is. All they want is comprehensive coverage on their home which you as the agent provides.
I don't have a list like some of the other replies, but just to put it simply, HO3 covers open perils which is pretty much anything that is not excluded within the policy.
I don't have a list like some of the other replies, but just to put it simply, HO3 covers open perils which is pretty much anything that is not excluded within the policy.
HO3 is open perils on dwelling and other structures (mainly real property) but broad named perils on contents. Broad named perils is standard on the HO4 and HO6. So, between those forms and nonstandard carriers writing HO2s, you have a measurable portion of the market insured on a named perils basis. Then you have the abominable HO8...I saw a market in Florida selling HO8s as "almost" HO3s." Too bad tar and feathers are so passe today.
AssociatePI.com
Expert
- 32
Could you out this together in a simple PowerPoint or pdf document? Something that's just a side by side comparison showing the more comprehensive coverage of the ho3? Nothing fancy, no pictures needed, just straight facts side by side. I know that would do the trick for me
