Before we can talk about the differences between an HO3 and an HO6 policy, we must first understand how each plan works individually.
What is an HO6 homeowner policy
An HO6 policy is just the technical name for Condo Insurance and will be for an apartment owner.
This type of insurance will traditionally only cover your personal property, personal liability, your walls, floors and your roofs when you live in an apartment.
But only as rental insurance, it does not cover the actual structure of the building and your homeowner's associations do not master the insurance policy.
An HO6 policy is a named escape policy for both your personal items and your property, which means it will only cover your items if they are damaged by the set of specific hazards specified in the policy.
What is an HO3 homeowner policy
The most common type of homeowners insurance policy you find is HO-3 or a special form.
Because it has a wide range of coverage and some of the most affordable premiums, it has become the most widely offered type of home insurance.
The HO-3 policy is actually a combination of an "open danger" policy and a "named hazards" policy.
It is considered a combination because it will cover your home (the physical house and connected structures) on an open dangerous ground and your personal property (your belongings) only on a specified dangerous ground.
The HO3 policy also only pays claims on an actual cash value basis.
We will cover exactly what the different types of dangers mean, as well as the type of payment options for claims a little further down in this post.
This policy will also cover other structures, personal liability and medical payments to others.
Open Risk Policy
An open risk policy is a complicated way of saying that you are covered for all risks as long as it is NOT listed as being exempt from your policy.
If your policy lists exceptions for ice, lightning and flooding, as long as the damage to your property was not due to ice, lighting or flooding, you would be covered.
Named Peril Policy
A Named Peril policy will only cover you for hazards specifically named in your policy documents.
This means that if your homeowner's insurance lists "snow" as a type of covered danger, but not "hail," then hail damage will not be covered at a specified risk.
Below is a list of named hazards that limit your personal property coverage on an HO3 policy
Remember your personal property if it is damaged by anything other than the items below; it is not covered by your home insurance:
The main difference between the two insurance policies will be that a HO3 policy is specific to a house and a HO6 policy was created for an apartment.
And while the HO3 policy is a mix of a named risk and open dangerous policy, HO6 policies tend to be fully named risk policies.
Of course, an HO3 policy will also cover the actual structure of your home as well as other structures on the property.
An HO6 policy does not cover some of the building's objects outside your apartment and usually covers everything up to the walls of your unit.
You also have the opportunity (depending on the company) to get the exchange cost value for your personal articles with a HO6 policy.
The HO3 policy usually only provides the actual cash value of the items you have lost and covers your personal property at a specified risk.
This is how it looks:
You can only get an HO6 policy if you move into an apartment so there really isn't much to decide when it comes to this.
If you buy a house you will need an HO3 or HO5 policy and will not be able to buy an HO6 policy on your home.
In general, who is it for?
HO3 policies are available for all home types (it is the insurance company's judgment if you will accept your insurance application.)
HO6 policies will be for an apartment owner and it will cover your personal property and personal responsibility when you live in an apartment.
We have found the best home insurance that comes from Hippo, you can check out or quickly review below.
There is no reason to go without home or apartment insurance, in fact over 70% of people do not even take home insurance.
They only take what is offered by a real estate agent or mortgage broker.
Now that you understand the differences between and the HO3 and HO6 policy, it is time to take action.
Remember that your policy should be unique to your specific situation and no matter what type of policy you choose, it must make sense for your home and your personal property.
Click here to get some quick quotes for the process started today.