What type of homeowners policy covers the dwelling and personal property on a named perils basis?

The HO-2 homeowners policy, also known as the Broad Form policy, specifically provides coverage for the dwelling and personal property on a named perils basis. This means that the policy only covers damages that arise from perils explicitly listed in the policy, such as fire, theft, and certain types of water damage.

This type of coverage is beneficial for homeowners as it ensures protection against a defined list of risks. Since personal property is also covered on a named perils basis, policyholders have clarity about what events could lead to reimbursement for damages or losses.

In contrast, other policy types cover either more or fewer perils or have different applications. For example, the HO-1 provides very limited coverage, generally only covering specific perils without including comprehensive protection. The HO-3 policy is more extensive, offering open perils coverage for the dwelling, while the HO-4, commonly known as a renters policy, does not cover the dwelling typically since it applies to tenants rather than homeowners. Therefore, the HO-2 is particularly important for homeowners seeking broad coverage without going into the open perils territory offered by the HO-3.