Understanding Your Homeowners Declaration Page

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Your homeowners declaration page will tell you exactly how much your policy will cost and the amount of coverage you will have. Unfortunately, this document is filled with confusing terms that offer absolutely zero explanation. What is coverage A, B, or C? Is an HO-3 a good thing?

We are here to break down all of the insurance jargon so you can better understand how your home is covered.

The Basics in the Homeowners Declaration Page

First things first, it’s important to know what your policy doesn’t cover. Flood damage? No. Earthquakes? Nope. Sewer backup? Try again. There are many events that are not covered by home insurance policies. Read more about it here.

At the top of your homeowners declaration page, you’ll see a policy number which is the number you’ll need to give to your agent if you have to file a claim. A policy period will also be listed stating the amount of days your policy will be in effect for.

The insured name will be you, the agent is the person or company who manages your policy, and the carrier is the company who provides the insurance.

Specific Coverages

There’s a list of coverages that are included within every homeowners insurance policy. These are coverages A, B, C, D, E, and F. Don’t know what these mean? You’re not alone! Here’s what you need to know:

  • Coverage A: Dwelling — This is coverage for the overall structure of your home including the roof. It also includes anything physically attached to the home such as a deck, garage, or patio.
  • Coverage B: Other Structures — Just like the name implies, this covers structures that are not attached to your home. Examples that may fit into this category are fences, sheds, pool, or gazebos.
  • Coverage C: Personal Property — This will cover the personal belongings in your home such as furniture or TVs. Certain items that have a high value such as jewelry or fine art have restricted coverage limits such as $1000 or $2500 in most policies. You will need additional coverage for these items which is referred to as a rider (which we will talk about later.)
  • Coverage D: Loss of Use — If you ever need to stay somewhere else while repairs are being made to your home for a covered claim, that’s what this coverage will be used for. The insurance company will cover certain expenses up to a certain time and price.
  • Coverage E: Personal Liability — This coverage provides you with legal protection if you are ever sued for an accident that happened on your property.
  • Coverage F: Medical Pay to Others — If someone gets hurt on your property, this coverage will cover the costs of their medical payments up to a certain amount.

Forms and Endorsements

This section of your homeowners declaration page will essentially add or delete coverage to your policy. For example, above we talked about jewelry or fine art being considered as “riders”. A standard homeowners policy doesn’t cover certain things of high value- so if someone stole your $12,000 engagement ring, you’d be out of luck. A rider will provide additional coverage for a high-value item, like an engagement ring) and you’ll be charged extra on your policy (example: typically 1-2% of an engagement ring’s value).

Some items that may show up in this section include:

  • HO-3: This is the standard, basic homeowners policy that covers your contents on a named perils basis, meaning there is a specific list of accidents that will and will not be covered. It will vary between carriers, but some examples of covered perils are theft, wind, and fire. Examples of HO-3 policy exclusions are: earthquakes, sewer backup, and sinkholes. HO-3 policies are limited to coverage outside the home only.
  • HO-5: This policy is considered an open peril policy which means that you’ll have coverage against almost any risk posed against your home AND the contents inside your home. There are certain exclusions, but the main advantage with an HO-5 policy is that it doesn’t specify between home content and structure. For example, if you spilled a glass of red wine on your brand new carpet, replacement carpet would be fully covered under an HO-5 policy, but not an HO-3.
  • HO-4: This policy is specific for renters and covers only belongings and personal liability.
  • Water/Sewer Backup: This coverage provides protection to your home if there are any damages from the backup of water or materials from a sewer, sump pump, or drain. It is not the same as flood insurance (you will have to buy a separate flood insurance policy).
  • Jewelry/watches/furs: The average homeowners policy covers only about $1,000 of jewelry or other valued items if they are stolen or destroyed. If you have an item valued greater than that, you will need to “schedule” those items and add them to your homeowners policy as an add on of sorts. The items will need to be professionally appraised before they can be covered.

That’s it!

Well, not quite — but this is the basic information that every homeowner should be aware of. If you have any questions or need a quote, one of our knowledgeable agents would be thrilled to help you! Contact our office at (248) 822-7170 or fill out the form below to get started:

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