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What is an HO-5 Insurance Policy?


Your home is likely one of your most significant assets, making safeguarding it against unforeseen circumstances paramount. Home insurance, specifically a homeowners insurance policy like the HO-5, is a vital protection tool that provides peace of mind for homeowners.

If you're new to home insurance or need a refresher on its fundamentals, our "Home Insurance 101 Guide" is the perfect starting point. This guide covers everything you need to know about protecting your home, from choosing the right policy to understanding your coverage options. Explore our Home Insurance 101 Guide to get better acquainted with the basics before diving deeper into the specifics of HO-5 policies.

Among the home insurance policies available, an HO-5 insurance policy stands out for its comprehensive protection and unique features. Keep reading to learn what makes an HO-5 insurance policy unique and how it can benefit you.

At a glance:

  • HO-5 policies are open-peril, which means they cover all perils unless explicitly excluded.

  • HO-5 policies typically feature higher limits for both dwelling and personal property, ensuring your personal belongings are well protected.

  • An HO-5 policy provides broader protection, making it an ideal choice for homeowners seeking peace of mind through comprehensive homeowners insurance policy coverage.

What is HO-5 insurance?

An HO-5 insurance policy provides broader coverage compared to other standard policies. Unlike other homeowners insurance policies, an HO-5 policy covers a wide range of risks unless specifically excluded. This means that you'll be protected from losses unless your policy explicitly states otherwise.

Open-peril coverage provides comprehensive protection, reducing gaps that may occur with other limited policies. Covered perils typically include fire, lightning, windstorm and hail, theft, vandalism, and more.

HO-5 policies typically offer higher coverage limits than standard (HO-3) insurance policies as well as replacement cost coverage. This means that in the event of a covered loss, the policyholder has the financial protection to repair or replace their property at today’s prices with the backing of their insurance company.

For a comprehensive overview of what home insurance covers, including the protections and peace of mind it offers homeowners, read our detailed blog on home insurance coverage.

What is included in HO-5 coverage?

The coverage provided by an HO-5 insurance policy is extensive. It protects your dwelling and personal belongings, and it provides personal liability coverage. Covered perils typically include fire, lightning, windstorm, hail, theft, vandalism, and more.

While specific details can vary between insurance providers, an HO-5 policy typically includes the following coverages:

  • Dwelling

  • Other structures

  • Personal property

  • Loss of use 

  • Personal liability

  • Medical payments to others

  • Ordinance or law coverage

  • Water damage

  • Scheduled property


Dwelling coverage helps repair or rebuild your house if it is damaged or destroyed by a covered peril. The dwelling coverage typically includes the main structure of the home, including roofs, walls, floors and other structural elements. This includes attached structures, like garages.

Other structures

Other structures coverage protects structures not attached to your main dwelling, like a detached garage, shed, or fence. Keep in mind that coverage for other structures is subject to the same perils and conditions as the main dwelling coverage. 

Personal property

Personal property coverage protects your personal belongings or possessions. This coverage helps you replace or repair personal items that are damaged, destroyed, or stolen.

Personal property typically includes items such as furniture, clothing, electronics, appliances, and other personal belongings. It's important to note that certain high-value items, like jewelry, art, or collectibles, may have limits.  Although policies have built-in limits, policies often allow you to schedule coverage for high-value items. 

Scheduled personal property

Scheduled personal property coverage can provide additional coverage for specific high-value items that exceed the standard personal property limits set in a home insurance policy. These items are often referred to as “scheduled items.” Scheduled personal property coverage on an HO-5 policy means your scheduled items are protected with higher coverage limits and broader protection.

Loss of use 

HO-5 policies cover Loss of Use, including Additional Living Expenses (ALE). If you are temporarily unable to live in your home due to a covered peril, this coverage is designed to assist with the additional living expenses you may face, such as:

  • Temporary housing 

  • Additional living expenses like meals, transportation and storage

It is important to note that loss of use coverage is subject to both dollar and time limits, and coverage can vary by state state, so it’s important to review your policy. 

Personal liability

HO-5 policies include coverage if you are legally responsible for injuries to other people or damage to their property. Personal liability helps cover the costs associated with legal defense, court judgments, and settlements if you are sued.

Medical payments to others

If a guest is injured on your property, an HO-5 policy covers medical payments, no matter who is at fault.

Ordinance or law coverage

Ordinance or law coverage helps cover the cost of repairing your home in compliance with current building codes if a covered loss triggers the need for updates. Local building codes tend to evolve, and when they do, the cost of repair may be substantially higher than when the house was constructed. 

Water backup

Water damage can be costly to repair, and water backup coverage can provide financial protection—and peace of mind. Water backup coverage protects against damage caused by water backing up into your home through sewers or drains that can be caused by heavy rain, sewer blockages, and more. 

Always review and understand the limits and exclusions of your insurance policy to ensure you have the coverage you need.

HO-5 vs HO-3

Choosing the right homeowners insurance policy is critical to the protection of your home and personal belongings. Two of the most widely available homeowners insurance policies are HO-3 and HO-5. While both provide coverage for your dwelling, personal belongings, and liability, they differ in their scope and level of protection. Understanding how an HO-3 and HO-5 policy differ is key for homeowners seeking the best coverage tailored to their needs. 

HO-3 insurance is the most popular type of homeowners insurance available and is suitable for a wide range of homeowners. An HO-3 policy will protect the dwelling itself against open perils, and personal belongings against a specific list of named perils. Named perils typically include events like fire, theft, vandalism, windstorms, and certain natural disasters. 

The major differences between an HO-3 and HO-5 policy are the comprehensiveness of coverage and perils. The chart below provides a good example of the differences between a standard HO-3 policy and an HO-5 policy offered by Openly insurance. 

For a deeper understanding of the differences between an HO-3 and HO-5 policy, and to decide which policy best suits your needs, check out our blog on HO-3 vs HO-5 insurance policies.

Why choose an HO-5 insurance policy

An HO-5 insurance policy offers several advantages, including broader coverage, higher coverage limits, and replacement cost coverage. While other policy types may provide adequate protection for some homeowners, HO-5 policies can offer a level of coverage that is unmatched.

The open perils coverage provided by HO-5 policies means homeowners don't need to worry about whether or not a loss is potentially covered—as long as it's not listed as an exclusion. And higher coverage limits provide financial security if homeowners need to repair or replace their home and belongings after a covered loss.

HO-5 policies don’t have to cost an arm and a leg; while the average premium for an HO-3 policy in the United States is $1,438, the average HO-5 rings in at just $1,511.1 So if you're looking for maximum protection, an HO-5 insurance policy may be the ideal choice for your needs and budget.

To explore top-tier options for high-value home insurance, consider Openly’s offerings. Openly provides access to exceptional homeowners insurance solutions and connects you with independent agents to tailor your coverage precisely. Complete our form, and we'll connect you with a licensed independent agent in your area, enhancing your journey to securing the best protection for your home.


* We provide this information to help you understand insurance. Any coverage is subject to the terms of your policy. Please refer to your policy and declarations page for complete coverage details.

1 National Association of Insurance Commissioners. “Dwelling Fire, Homeowners Owner-Occupied, and Homeowners Tenant and Condominium/Cooperative Unit Owner’s Insurance Report: Data for 2021.” NAIC. Published December 2023. Accessed 5 March 2024.



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About the Author

Alyssa Little | Senior Content Strategist

Alyssa is the Senior Content Strategist at Openly, collaborating with industry thought leaders to provide insightful and informative content in the home insurance space. With over 15 years experience in content marketing strategy, copywriting, and editing, Alyssa has refined her expertise through her work at such companies as Gartner, Nike, and Trupanion. Alyssa holds a BA in History from the University of Puget Sound and an MA in Museum Studies from Newcastle University.

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