What perils is covered on an H08 policy?

Answer 1

An HO-8 policy is generally made for an older home in a situation where you may not want to carry the amount of insurance it would take to rebuild the home as it is. This policy is an Actual Cash Value policy which means that they will pay claims based on what the real estate value of the home is rather than what the replacement cost of the home is. An HO-3 requires that you insure the home for the amount that it would take to rebuild it as it is with similar material. In this case, a homeowner may not want to pay for $400,000 of insurance when the home is worth $100,000 on the real estate market. With an HO-8 or HO-10 policy you can purchase $100,000 of insurance and if the house burns the company will pay you $100,000 for the home plus the amount for you contents inside the home.