Glossary

HO-3 (special form)

The most common homeowners policy: open-perils coverage for the house and other structures, and named-perils coverage for belongings.

Also called: HO 00 03, HO3, special form

HO-3 (ISO HO 00 03) is the policy most owner-occupied single-family homes carry. It insures the dwelling (Coverage A) and other structures (Coverage B) on an open perils basis: any direct physical loss is covered unless the policy excludes it. Personal property (Coverage C) is covered only for the 16 named perils also used in the HO-2. Loss of use (D), liability (E) and medical payments to others (F) complete the package.

The exclusions do the real work. Flood and surface water, earth movement, wear and tear, neglect, mold in most cases, intentional loss and nuclear hazard are the usual ones. On open perils, the insurer generally has to show that an exclusion applies.

Buildings are settled at replacement cost if you insure to at least 80% of the full rebuild cost. Say your dwelling limit is $300,000 and rebuilding would cost $400,000: you carry 75%, so a partial loss is paid on a reduced basis. Belongings are paid at actual cash value unless you add replacement cost by endorsement. Insurers often modify the ISO wording, so check your own form; ISO homeowners forms and why your policy may differ explains why, and The HO-3 policy explained: coverages, exclusions and gaps walks through the form.

Last reviewed October 10, 2026

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Related terms

HO-2 (broad form) A named-perils homeowners policy covering 16 listed causes of loss for the house and belongings: broader than the basic form, narrower than the special form. HO-5 (comprehensive form) A premium homeowners policy insuring the house, other structures and belongings against any cause of loss not excluded, often for newer or higher-value homes. Open perils Coverage that applies to any direct physical loss unless the policy specifically excludes the cause, so the insurer must point to an exclusion to deny a claim. Named perils Coverage that applies only to the causes of loss listed in the policy, so a claim is paid only if the damage came from one of them. Dwelling coverage (Coverage A) The part of a homeowners policy that pays to repair or rebuild the house itself, including attached structures such as a garage, porch or deck. Exclusion A policy provision that removes coverage for a stated cause, type of loss, property or circumstance that the coverage would otherwise reach.

Related guides

Home insurance for first-time buyers: what changes when you own How homeowners insurance works for a first-time buyer: what it adds to your monthly payment, what the lender skips and six decisions to make before closing. HO-2 broad form vs HO-3: what changes in a claim The HO-2 insures the house against 16 named perils; the HO-3 against anything not excluded. Where the gap shows up, who must prove what, and lender limits. The HO-3 policy explained: coverages, exclusions and gaps How the standard HO-3 special form works: open perils on the house, named perils on belongings, the 80% rule, key exclusions and the gaps endorsements fill. HOA insurance requirements for owners: what you must carry What a homeowners or condo association insures, what its documents and your lender can require you to carry, and how to prove compliance and avoid fines. Homeowners policy types: HO-1 through HO-8 explained What each HO form covers, who can buy it, how many policies use it, and how to find the form on your own declarations page. How much does homeowners insurance cost? The NAIC's latest data (2023) puts the average HO-3 premium at $1,737, but states range from $923 to $3,027. What the averages mean and how to size up a quote.

Related tools

Which homeowners policy form fits your home? Answer a few questions about who owns the home, what kind it is and how it is used, and see which standard policy form usually fits and why.