Does an HO8 Policy Cover Repair Costs?

An HO8 homeowners insurance policy is a specialized form of coverage designed for dwellings that may not qualify for a standard homeowners policy. This type of policy is typically used for older homes, historic properties, or those with unique construction features, often where the cost to rebuild might exceed the market value. It serves as a more limited form of protection compared to broader policies, offering coverage for specific perils rather than a wide array of potential damages.

HO8 Policy Coverage Explained

An HO8 homeowners insurance policy operates on a “named peril” basis, meaning it only covers damages caused by events explicitly listed in the policy document. This contrasts with “open peril” policies that cover all damages unless specifically excluded. The specific perils typically covered by an HO8 policy include:

• Fire or lightning
• Windstorm or hail
• Explosion
• Riot or civil commotion
• Damage from aircraft
• Damage from vehicles (not your own)
• Smoke
• Vandalism or malicious mischief
• Theft
• Volcanic eruption

A central aspect of HO8 policies is the use of “Actual Cash Value” (ACV) for claims. ACV accounts for depreciation, meaning the payout for damages reflects the cost of replacing the damaged property minus its accumulated wear and tear, age, and obsolescence. For example, if a 20-year-old roof is damaged by a covered windstorm, the policy would pay for its depreciated value, not the cost of a brand-new one. This valuation method means policyholders typically receive less than the full cost to repair or replace damaged property.

An HO8 policy covers dwelling, other structures, personal property, and loss of use. All these coverages are subject to the named perils and ACV valuation. For instance, if a fire, a named peril, damages your home’s structure or personal belongings, the policy would contribute to repair or replacement based on their depreciated value.

Common Exclusions in HO8 Policies

HO8 policies, while providing specific coverage, also contain common exclusions that limit what repair costs are covered. For example, damage caused by floods, earthquakes, or landslides is typically excluded from a standard HO8 policy. Homeowners in areas prone to these natural disasters often need separate, specialized policies, such as flood insurance through the National Flood Insurance Program (NFIP) or private insurers, and earthquake insurance.

Water damage from sources like burst pipes, accidental discharge, or sewer backup is generally excluded, unless it results from a named peril. Similarly, issues stemming from mold, wear and tear, neglect, or pest infestations are usually not covered, as these are often considered preventable through routine home maintenance. Damage from falling objects, such as trees, is also frequently excluded unless the falling object was a direct result of a covered peril like a windstorm.

Further exclusions can include damage from governmental actions, ordinance or law changes (like updated building codes requiring more expensive repairs), power failures, and war. Some of these perils might be covered by purchasing additional endorsements or separate policies, but they are not part of the basic HO8 coverage.

Steps for Filing an HO8 Claim

Filing an HO8 insurance claim for covered repair costs involves a structured process. The initial step after damage occurs is to prioritize safety and take immediate measures to prevent further damage to the property, such as boarding up broken windows or covering a damaged roof with a tarp. Document the damage extensively with photos and videos, capturing wide shots and close-ups from multiple angles, ideally with timestamps.

Promptly notify the insurance company about the damage, typically within a few days of the incident or discovery. Homeowners should have their policy number and a brief description of the event ready when contacting their insurer. The insurance company will then assign an adjuster to assess the damage, who will visit the property to evaluate the extent of the loss and determine if it falls under the policy’s named perils.

During the adjuster’s assessment, provide all documented evidence. Policyholders should also obtain repair estimates from licensed contractors to provide a clear picture of the costs involved. Keeping detailed records of all communications with the insurer, as well as receipts for any temporary repairs or additional living expenses if the home is uninhabitable, will support the claim process.