What is an HO-1 Insurance Policy?
HO-1 insurance: Simple, no-frills protection for your home’s structure
- Covers your dwelling against a limited list of risks
- Often the most affordable option for homeowners
- Doesn’t include belongings, liability, or extra living expenses
What is an HO-1 insurance policy?
An HO-1 policy keeps things simple and affordable, making it a good fit for homeowners who want basic peace of mind without paying for extra coverage they don’t need.
It protects your home’s structure against a set list of risks, which can be enough for certain situations—like if you’re insuring an older property, looking for budget-friendly protection, or just want straightforward coverage. Just remember, HO-1 won’t cover personal items, liability, or living expenses if you’re displaced.
How to Read a Homeowners Insurance Policy
Master the essentials of your homeowners insurance policy, learn how to interpret the declaration page, identify coverage limits & recognize exclusions.
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What does an HO-1 policy cover?
An HO-1 homeowners policy is the most bare-bones option typically sold by home insurance companies. It offers no coverage for personal belongings, the insured party's liability, other parties' medical expenses, or coverage for accommodations if the home becomes uninhabitable.
An HO-1 policy only covers the dwelling on a named peril basis (a peril is the reason for the damages).
For coverage to apply on a named peril policy, the damage to the home must be caused by one of the following perils listed to the right.Â
What doesn’t an HO-1 policy cover?
An HO-1 policy is bare-bones coverage, so it leaves out quite a bit. While it does include the essentials—like liability protection and coverage for your personal belongings—it doesn’t go much further. Because of its limited scope, there are plenty of situations where an HO-1 simply won’t provide enough protection. Let's look at a few examples of where you will likely want more protection.
Homeowners policies work in tiers — with HO-2, HO-3, and HO-5 being more comprehensive coverage options. These policies cover additional perils, including those listed below, not covered by an HO-1 policy.
- Falling objects
- Weight of ice, snow, or sleet
- Freezing of household systems (AC or heating)
- Sudden and accidental tearing apart, cracking, burning, or bulging of pipes and other household systems
- Accidental discharge or overflow of water or steam
- Sudden and accidental damage from artificially generated electrical current
Liability insurance provides legal assistance and monetary protection in the event of a lawsuit, making the liability portion of a homeowners policy very important. Without it, you can be held financially responsible if you damage someone’s personal belongings or cause them injury.
If your personal belongings are destroyed in a fire, an HO-1 policy would not cover these losses, including clothes, furniture, and appliances. If you’re considering an HO-1 policy, carefully evaluate the value of your personal property — can you afford to replace everything in your home?
If someone is injured on your property, this coverage would pay for their medical expenses.
Medical payment home insurance coverage includes:
- Medical bills and payments
- Surgical costs
- Cost of X-rays
- Dental procedures
- Ambulance and hospital fees
- Nursing care
- Prosthetic devices
- Funeral services
Without this coverage, you can be held liable for damages, which means you can be sued. Lacking liability coverage puts your assets at risk.
Sometimes referred to as "loss of use," additional living expenses coverage handles costs incurred if you need to vacate the home due to a covered loss. If your home is damaged by fire and you need to live in a hotel for a few weeks, this coverage would reimburse you for your stay. Without this coverage, you would be stuck footing the bill for any temporary housing expenses.
Other exclusions
There are some additional HO-1 policy exclusions. Many of these circumstances are excluded from all homeowners insurance policies.
- Flood
- Hurricane
- Mold*
- Vandalism to vacant dwellings
- Wear and tear
- Damage caused by pets
- Earthquakes*
- Enforcement of building codes and similar laws
- Intentional acts
- Neglect
- Government acts
*Some policies allow you to add limited coverage for mold damage. Furthermore, you can add earthquake insurance via a supplementary policy.
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Homeowners insurance coverage: what to consider
Because it only provides dwelling coverage, HO-1 policies are not very common. It is generally only used to cover your home against catastrophic losses, i.e, a total loss. An insurance company might require you to insure your home with an HO-1 policy if they deem you or your dwelling are too risky for other types of homeowners policies — this happens for older homes on occasion.
Many mortgage lenders will not approve HO-1 policies — for good reason. A home is an investment and should be insured as such. Insurance is one of the cheaper aspects of homeownership, so it's worth the small investment.
Below are additional policies worth considering if you’re shopping for home insurance. If you're unsure and need help figuring out coverage options, reach out to one of our expert agents.Â
- HO-2 — Broad Form Policy
- HO-3 — Special Form Policy
- HO-5 — Comprehensive Form Policy
While an HO-2 policy is slightly more common than an HO-1, it still falls short of the default home insurance coverage levels. HO-5 is the most comprehensive form of homeowners insurance, while an HO-3 policy is the most common home insurance policy type.
We can help find you the right coverage for your needs.
HO-1 Policy FAQs:
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