9 Factors That Jack Up the Cost of Home Insurance

Beyond basic coverage, there are at least seven different types of homeowners insurance, and the rates are generally higher for more comprehensive plans. Some folks go with HO-2 coverage, the second to lowest level. These relatively cheap “broad form policies,” protect your property and valuables from 6 named perils including fire and lightning, freezing of household systems, and accidental damage caused by artificial electrical current. Most Americans (about 79 percent, as of 2017) go with HO-3 “special form” policies that cover all risks, except for excluded perils (like government action, flooding, and war). HO-5 “comprehensive form” policies offer, among other benefits, broader coverage for personal property. This level of coverage costs more and is best suited to high value single-family dwellings.