Property insurance: homeowners and tenant policies, coverage, and the agent's role

Match the policy to the home

Homeowners insurance combines property protection with personal liability coverage. Dwelling, other structures, personal property, and loss of use address different losses. Loss of use can pay additional living expenses after a covered loss; liability addresses covered claims by others, while medical payments can cover certain injuries without requiring a finding of fault. Limits, exclusions, deductibles, and settlement conditions govern the actual policy.

Recognize the forms

HO-1 is basic named-peril coverage; HO-2 is broader named-peril coverage. HO-3 generally covers the dwelling on an open-peril basis and personal property against named perils. HO-5 generally provides open-peril protection for both. Named-peril coverage requires a listed cause of loss; open-peril coverage applies unless excluded. HO-4 is renters insurance for belongings, liability, and loss of use, rather than the landlord's building. HO-6 addresses condominium unit-owner interests, including belongings and covered unit improvements, alongside the association's master policy. HO-7 is designed for mobile or manufactured homes. HO-8 is modified coverage often suited to older homes whose replacement cost exceeds market value; its settlement terms differ from ordinary replacement-cost protection.

Separate value from price

Actual cash value generally means replacement cost less depreciation. Replacement cost addresses repair or replacement with comparable materials without a depreciation deduction, subject to settlement conditions. Neither equals the home's sale price, which includes land. A deductible is the insured's share of a covered loss.

Check gaps early

Ordinary homeowners coverage generally excludes flood and earthquake damage. Buyers should investigate separate protection and lender requirements before closing. Federal law applying in New York requires flood coverage for specified loans secured by improved property in special flood hazard areas where flood insurance is available. Qualifying private flood insurance can satisfy the requirement.

New York Insurance Law § 3445 directs windstorm-deductible disclosure regulations requiring an insurer's plain-language notice explaining the amount and circumstances of application, and directs standards for hurricane-windstorm deductible triggers. It does not prescribe one universal deductible percentage or storm trigger.

Under New York Insurance Law § 5403, a person with an insurable interest who has made a diligent normal-market effort is entitled to apply to the New York Property Insurance Underwriting Association. Issuance depends on statutory and plan conditions. Do not equate association fire coverage with a complete homeowners package: homeowners coverage under article 54 depends on the superintendent's determination of necessity.

A real estate salesperson helps buyers raise insurance questions early, coordinate evidence required for closing, and seek coverage advice from an insurance professional. The salesperson should not promise that a particular loss will be paid.