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RMC Insurance Services
Home Owners
Insurance > Types
Homeowners insurance protects you from financial
losses caused by storms, fire, theft, and other events
outlined in your policy. It is important to know what's
in your policy. This publication gives you general
information about homeowners insurance, but it is not a
substitute for the policy itself. Make sure you read
your policy carefully and understand your specific
coverages. It's also important to know your rights.
Texas has a Consumer Bill of Rights for homeowners and
renters insurance. Your company must send the Bill of
Rights with your policy or renewal.
Don't wait until you have a claim to review your
policy and to know your rights.
Texas Homeowners Policies
You can buy a dwelling policy that covers only the
structure of your house. Or, like most Texans who own
their homes, you can buy a homeowners policy, which
combines five different types of coverage:
Dwelling - pays for damage to your
house and any outbuildings, such as detached garages
and storage sheds.
Personal property - pays when
household items, including furniture, clothing and
appliances, are damaged, stolen, or destroyed.
Liability - protects you against
financial loss if you are found legally responsible for
someone else's injury or property damage. A homeowners
policy automatically provides $25,000 in coverage. You
can buy up to $1 million in coverage for an extra
premium.
Medical payments - pays medical
bills for people hurt while on your property. It also
pays for some injuries that happen away from your home,
such as your dog biting someone. A basic homeowners
policy pays $500 in medical bills. You can pay extra
and get up to $5,000 in medical payments coverage.
Loss of use - pays living expenses
if your home is too damaged to live in during repairs.
The most common policy pays up to 10-20% percent of the
amount for which your house is insured.
Types of Homeowners Insurance Coverages
Insurance companies may sell several types of
policies in Texas, each with a different level of
coverage. Three of the policy forms available for sale
in Texas - the HO-A, HO-B, and HO-C - are standardized.
This means the policy language and coverages provided
by these policies are the same, regardless of the
company writing the policy. Keep in mind, however, that
although an HO-B policy written by one company will be
exactly the same as an HO-B policy written by another
company, the two companies may charge different rates.
Companies may also offer alternative policy forms,
if approved in advance by the Commissioner of
Insurance. These policies are not standardized and
usually provide varying coverages. Read your policy
carefully to know exactly what coverages are included.
Some companies may sell more than one policy form. In
general, however, a company will offer only one form to
its customers. If a company offers you a policy with
less coverage than you'd like, ask if other policy
forms are available. You also may be able to add
additional coverage by buying endorsements to your base
policy.
Following is a brief description of the types of
policies sold in Texas:
- HO-A policies provide
extremely limited actual cash value coverage of
your home and its contents. Only the types of
damage specifically listed in the policy are
covered. The HO-A is a standardized Texas policy.
- HO-A amended policies provide
more extensive coverage than the base HO-A policy
but less coverage than an HO-B. HO-A amended
policies are not standardized. Coverage provided
by these policies may differ by company.
- HO-B policies provide
replacement cost coverage for most types of
damage, except those specifically excluded in the
policy. The HO-B is a standardized Texas policy.
- HO-C policies provide the
most extensive coverage, but they are more
expensive than other types of policies. The HO-C
is a standardized Texas policy.
- Approved alternative policies
offer varying levels of coverage. Companies can
sell alternative policies only if the policy form
is approved in advance by the Commissioner of
Insurance. These policies are not standardized.
Coverage may differ considerably from one company
to another and from the coverage provided in the
standardized Texas homeowners policies.
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