You Need To Know About HO-4 Insurance Policy
What Is an HO-4 Insurance Policy?
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Different situations and structures need different types of insurance. HO-4 insurance is one of them. Renters insurance covers valuables and liability while renting an apartment, condo, or home.
Here is what a HO-4 insurance policy covers, how much one normally costs, and whether you should consider purchasing this sort of coverage:
What Is HO-4 Insurance?
Standard renters’ insurance, HO-4, protects your personal property from the following 16 hazards (events that can cause property damage):
- Fire or lightning.
- Windstorm or hail Storm.
- Unrest or civil unrest.
- Damage brought about by aircraft.
- deterioration brought about by vehicles.
- Smoke.
- Vandalism or harmful interference.
- Theft.
- Volcanic eruption.
- Dropping object.
- Ice, snow, or sleet weight.
- Leakage of water or steam from plumbing, air conditioning, or other appliances.
- Damage caused by the hot water heating system, the air conditioner, the heater, or the fire protection system, among others.
- The freezing of plumbing, heating, appliances, and pipelines, etc.
- Damage from electrical currents, etc.
In addition, renters’ insurance covers any damages you or your dependents cause to third parties.
Credible can assist you in comparing homeowners’ and renters’ insurance quotes from numerous providers. Our rate check service is free and will not affect your credit score.
What Does HO-4 Insurance Cover?
Your landlord probably has homeowner’s insurance to protect the building in case of a fire, windstorm, or other covered disaster. However, this coverage normally does not extend to your personal property if it is destroyed or to your living expenses if you are forced to relocate.
When calamity strikes, renters insurance can provide a financial safety net. HO-4 insurance typically provides the following three coverages:
- Personal property: Most insurers should cover damage to your personal property caused by covered risks. If your clothing, gadgets, furniture, or other items are destroyed, lost, or stolen, your insurance company will compensate you up to your policy’s limitations.
- Liability: If someone is injured in your flat, HO-4 insurance will pay for their medical expenses and legal fees if they sue you. Additionally, renters insurance protects you if you damage a guest’s property.
Read: The Best Universal Property Expands Underwriting and Claim Analytics
- Additional living expenses (ALE): ALE is an alternative word for loss of use coverage, which protects you if the rental property becomes inhabitable owing to a covered danger. If you are forced to relocate, renters insurance can reimburse you for additional living expenses, including hotel bills and restaurant meals.
Keep in mind: As with other types of insurance, your renters insurance policy will include coverage limits and a deductible — the amount you’ll have to pay out of yourself before your insurance begins paying claims.
What Does HO-4 Insurance Exclude?
Your renters insurance policy won’t cover you for the following:
| Coverage type | Not covered |
|---|---|
| Personal property | Personal belongings whose value exceeds policy limits |
| Liability | Liability coverage above your coverage amounts |
| Additional living expenses | Structural damage to your rental building |
In addition, the majority of insurance companies do not cover the following incidents with renters insurance:
- Flooding, earthquakes, and other natural disasters: Certain natural disasters are excluded from coverage under a renters insurance policy. As needed, you may be able to obtain additional insurance coverage. For instance, the National Flood Insurance Program offers different flood insurance policies.
- Theft of or damage to luxurious items: The value of costly jewellery, art, and collectibles may exceed the limits of your HO-4 coverage. Consider adding a rider to your renters insurance policy if you wish to cover the full value of these goods.
- Structural damage to your rental building: Your landlord’s insurance will cover property damage. However, it is prudent to acquire liability insurance in the event that your landlord sues you for the damages.
How Much Do HO-4 Insurance Policies Cost?
According to the National Association of Insurance Commissioners (NAIC), the average yearly cost of HO-4 insurance in the United States in 2019 was $174, or around $14.50 per month for renters insurance.
The cost of renter’s insurance is determined by a number of factors. Location is a primary consideration. Other criteria include the quantity of coverage you select, the amount of your deductible, and your claims history.
How Much Does An HO-4 Insurance Policy Cost by State?
Location is the most significant element in determining the cost of renters insurance. Expect to spend extra if you reside in a city or location with a high rate of crime.
Likewise, premium rates vary considerably from state to state. According to the NAIC, Mississippi renters have the highest average rates at $252 per year, while North Dakota renters have the lowest average premiums at $115 per year.
According to NAIC data, here are the typical yearly and monthly premiums for renters insurance in every state.
| State | Average annual premium | Average monthly premium |
|---|---|---|
| Alabama | $219.0 | $18.25 |
| Alaska | $182.00 | $15.16 |
| Arizona | $164.00 | $13.16 |
| Arkansas | $208.00 | $17.33 |
| California | $175.00 | $14.58 |
| Colorado | $159.00 | $13.25 |
| Connecticut | $183.00 | $15.25 |
| Delaware | $153.00 | $12.75 |
| Florida | $180.00 | $15.00 |
| Georgia | $209.00 | $17.41 |
| Hawaii | $174.00 | $8.28 |
| Idaho | $148.00 | $12.33 |
| Illinois | $157.00 | $13.08 |
| Indiana | $164.00 | $13.66 |
| Iowa | $132.00 | $11.00 |
| Kansas | $167.00 | $13.91 |
| Kentucky | $162.00 | $13.50 |
| Louisiana | $236.00 | $19.66 |
| Maine | $149.00 | $12.41 |
| Maryland | $157.00 | $13.08 |
| Massachusetts | $186.00 | $15.50 |
| Michigan | $182.00 | $15.16 |
| Minnesota | $135.00 | $11.25 |
| Mississippi | $252.00 | $21.00 |
| Missouri | $173.00 | $14.41 |
| Montana | $149.00 | $12.41 |
| Nebraska | $144.00 | $12.00 |
| Nevada | $179.00 | $14.91 |
| New Hampshire | $146.00 | $12.16 |
| New Jersey | $156.00 | $13.00 |
| New Mexico | $186.00 | $15.50 |
| New York | $185.00 | $15.41 |
| North Carolina | $159.00 | $13.25 |
| North Dakota | $115.00 | $9.58 |
| Ohio | $163.00 | $13.58 |
| Oklahoma | $235.00 | $19.58 |
| Oregon | $158.00 | $13.16 |
| Pennsylvania | $153.00 | $12.75 |
| Rhode Island | $182.00 | $15.16 |
| South Carolina | $182.00 | $15.16 |
| South Dakota | $117.00 | $9.75 |
| Tennessee | $189.00 | $15.75 |
| Texas | $220.00 | $18.33 |
| Utah | $149.00 | $12.41 |
| Vermont | $151.00 | $12.58 |
| Virginia | $149.00 | $12.41 |
| Washington | $157.00 | $13.08 |
| Washington, D.C. | $158.00 | $13.16 |
| West Virginia | $185.00 | $15.41 |
| Wisconsin | $127.00 | $10.58 |
| Wyoming | $147.00 | $12.25 |
How Does An HO-4 Policy Differ From Other Policies?
Typically, insurance providers that offer homeowners insurance also offer renters insurance. Moreover, insurance policies and homeowners’ insurance policies are practically comparable.
The primary distinction is that renters insurance does not cover the building itself; your landlord’s homeowners insurance does.
HO-4 Vs. HO-6 Home Insurance Policies
An HO-4 policy is another word for renters insurance, which protects your personal property and offers liability coverage while you reside in a rented property. An HO-6 policy, on the other hand, is a sort of homeowners insurance for condo and co-op unit owners.
Similar to renters insurance, HO-6 policies cover your goods and provide liability protection, but HO-6 policies also insure the structural components of the building you own (i.e., the interior of the unit). Both types of insurance policies cover additional living expenses and protect you from all sixteen risks.
Who Needs An HO-4 Insurance Policy?
If your landlord demands it, you may be required to obtain a HO-4 coverage. Otherwise, you need merely renters insurance to safeguard your personal belongings. Since you do not own the building, you are not required to obtain homeowners insurance.
If you own precious items that may be difficult to replace, such as heirlooms, jewellery, and watches, you may need to get additional coverage as most regular renters insurance policies do not provide adequate coverage limits for these items.
How Much HO-4 Insurance Do You Need?
Ensure you have sufficient renters insurance to cover your belongings, liability, and additional living expenses following a covered event.
- Personal possessions: Make sure your renters insurance covers your belongings, liability, and additional living expenses following a covered event.
- Liability: Some experts recommend $300,000 in liability insurance. Consider an umbrella policy with $200 to $350 yearly premiums for $1 million in liability coverage.
- Additional living expenses: If your rental becomes uninhabitable after a covered occurrence, estimate hotel, restaurant, laundry, and other living expenditures. ALE coverage is typically 30% of your personal property coverage.
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