Texas Homeowners Insurance is a major investment, but it’s necessary to protect an even bigger investment—your home.  In the event of an accident or disaster, you and your family need to be protected and compensated for your loss.  If you are shopping for Home Insurance in Dallas, Tx it’s important to know exactly what you’re buying and get the right amount of coverage at a price you can afford. If your house has a mortgage on it, the bank will require you to have this insurance, so it makes shopping around to find the right coverage and the lowest price even more crucial. Here is a look at a couple of the different policy types available for home insurance in Texas.

The most basic type of coverage available in Texas is the HOA Policy. It covers the basic perils named in the policy, such as fire, lightning, and wind/hail damage. Losses a paid on an actual cash value basis, which means replacement cost less depreciation. This coverage is very limited and it is typically used to insure older homes or homes in poor condition.

The HOA Plus Policy increases the covered named perils in the policy substantially and can add coverage like sudden & accidental discharge of water, back up of sewers and drains, foundation coverage, replacement cost coverage and more. A well endorsed HOA Plus policy can offer very good coverage.

The HOB policy, at one time, was considered the standard policy in Texas. This is no longer the case, since many companies no longer offer this type of coverage. It offers all risk coverage on the dwelling, unless specifically excluded, includes replacement cost coverage and named peril coverage on the contents. This policy offers very broad coverage and is an outstanding policy to purchase, if it is offered at a reasonable price.

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Homeowners Form C (HOC Policy) goes even further, covering the policyholder against every type of peril (unless excluded) for both the dwelling and the contents, besides floods and earthquakes.  It has a high cost attached to it, which is why it’s not too popular with most families and many companies do not offer it. Floods and earthquakes require special policies that must be purchased separately no matter what home insurance policy you buy.

The HO-3 policy offers “Open Peril Coverage” on the dwelling, which means all risk coverage unless excluded, and “Named Peril Coverage” for contents. It is typically an excellent policy that includes replacement cost coverage, water damage coverage for sudden and accidental discharge of water and slow leak coverage, backup of sewer and drains, foundation coverage and more.

However, many companies have now begun to offer what I would call a HO-3 Modified, where they remove the slow leak coverage for water damage and limit the water damage coverage to sudden and accidental discharge of water. (i.e.: burst water heater). I have also seen other modifications that reduce the coverage significantly. Like every other coverage form, the HO-3 is no longer standard and can vary greatly from company to company.

Finally, some companies now offer what are called ”Company Specific Forms.” Which means just that. A particular company decides what they wish to cover, designs a policy to represent that, gets it approved by the states they do business in and offer that coverage for their homeowners insurance clients. Obviously, this would not be a standard form. However, most companies that use this generally mirror the coverage after a HO-3 policy or a HO-3 Modified Policy Form.

Whether your home is located in Dallas, Fort Worth or some of the surrounding cities in the DFW Area such as Plano, Frisco, Allen, McKinney, Highland Park, Southlake, Flower Mound, Arlington, Rockwall or Rowlett you will need to keep in mind that all homeowners insurance policies are not the same. Coverage can vary drastically from company to company. So, when you are obtaining quote comparisons online or by some other means, be sure to ask questions and deal with a reputable and experienced agency. The cheapest insurance policy available is not always the best option.

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