ARS HOME-INSURANCE EDUCATION

What an HO-3 Policy Typically Covers

A homeowner-friendly orientation to common HO-3 coverage sections, causes of loss, valuation terms, and questions to take to your insurer.

Updated September 2026 · Technical review: ARS Restoration & Reconstruction

Your documents control. “HO-3” describes a common homeowners policy form, but company forms, endorsements, exclusions, limits, deductibles, and Washington requirements vary. This page cannot tell you whether a particular loss is covered.

Common coverage buckets

Coverage A — Dwelling

The house and items attached to it, subject to the policy’s covered causes, exclusions, limits, and settlement terms.

Coverage B — Other structures

Detached structures such as a garage, shed, or fence, usually with a separate limit and policy conditions.

Coverage C — Personal property

Belongings owned or used by an insured, with special limits or exclusions often applying to certain categories.

Coverage D — Loss of use

Potential additional living expense or related loss-of-use benefits when policy conditions are met.

Coverage E — Personal liability

Liability protection for certain claims alleging bodily injury or property damage, subject to policy terms.

Coverage F — Medical payments

Limited medical-payment coverage for certain injuries to others, generally without determining legal liability.

How causes of loss are commonly structured

Many HO-3 forms use a broader “open-perils” structure for the dwelling and other structures: a cause may fall within coverage unless excluded or limited. Personal property is commonly handled under a listed or “named-perils” structure: the cause generally must be one of those stated in the policy. The exact form and endorsements matter.

Even when a cause is covered, the policy may separately address resulting damage, the failed part or appliance, tear-out and access, code upgrades, mold, fungi or bacteria, debris removal, trees, water backup, service lines, flood, earth movement, neglect, vacancy, and repeated seepage or leakage.

Water losses: describe facts, not conclusions

“Water damage” is not one coverage answer. A sudden pipe break, long-term seepage, rain through a damaged opening, sewer backup, groundwater, surface flooding, appliance overflow, or firefighting water may be treated differently.

Report what you directly observed: where water appeared, when it was discovered, and what equipment or system was involved.
Do not guess at a cause. Preserve failed components when practical and authorized.
Ask whether any water, sewer-backup, sump, mold, service-line, or flood endorsement applies.
Separate emergency mitigation from repair of the source and from permanent reconstruction.

Valuation and payment terms to locate

Term	Question to ask
Replacement cost	What conditions and deadlines apply before the full replacement-cost amount is considered?
Actual cash value	How was depreciation calculated, and is any portion potentially recoverable after repair or replacement?
Deductible	Which deductible applies, and is it subtracted once or by coverage/occurrence?
Limit or sublimit	Is there a lower cap for a specific item, cause, or expense category?
Ordinance or law	Is code-upgrade coverage included, and what triggers it?
Proof and deadlines	What inventories, proof of loss, receipts, or completion documents are required, and by when?

Bring these questions to your insurer

What is the complete policy form number and which endorsements changed it?
Which coverage section is evaluating each part of the loss?
What exclusions, limits, or sublimits are being considered?
Is the insurer distinguishing the source repair from resulting property damage?
How will building, contents, debris, code, and temporary living expenses be valued?
What emergency work may proceed, and what records are expected?
If part of the claim is limited or denied, will the decision and supporting policy language be provided in writing?

Keep restoration facts and coverage decisions separate

ARS can document observed conditions and the work it performs. Your insurer determines coverage; a licensed insurance professional or attorney can address policy or legal interpretation.

Sources, scope, and review

Review note: Prepared September 2026. Coverage labels are a general orientation, not a substitute for reading the declarations, policy form, and endorsements. This resource is educational and does not replace instructions from emergency services, your insurer, medical professionals, building officials, engineers, environmental professionals, or legal counsel. ARS does not determine insurance coverage.