What is an HO-7 Insurance Policy?

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HO-7 policy, also known as MH3 policy, is an insurance policy that shields the structure of manufactured and mobile homes from all perils except those listed as exclusions.

What is an HO-7 Insurance Policy?

It is a type of homeowners insurance that offers coverage for single-wide, double-wide, and triple-wide mobile homes on an open-peril basis. This means that your home is insured for every situation except those not listed on your policy.

This insurance policy also insures your belongings on a named-peril basis for the cost of their replacements. This means that only properties listed in your policy will be covered.

Mobile homeowners have special home insurance needs, which makes HO-7 policy best for them. HO-7 insurance offers a wide range of coverage to mobile homeowners and home manufacturers.

Just like every other home insurance policy, it is advisable to know if this insurance is good enough for your home needs and how much it costs. 

Who is an HO-7 Insurance Policy for?

This type of home insurance policy is for mobile homeowners who request the same insurance coverage as comprehensive homeowners insurance, along with the peace of mind that comes with it for homeowners in a single-family home.

The dangers of living in a mobile home range from a higher possibility of theft of personal belongings and personal liability to a higher risk of weather events.

This is because mobile homes do not have a foundation. However, if you are a mobile home renter, you will not be able to get a HO-7 insurance policy; instead, you should get a renters insurance policy.

What Does an HO-7 Insurance Policy Cover?

Just like an HO-3 home insurance policy, an HO-7 insurance policy covers your home’s belongings, loss of use, medical payments to visitors, other structures, and personal liability. In summary, an HO-7 policy covers the following:

  • Mobile home damages.
  • Theft or damage to personal belongings.
  • Legal costs if a third party sues you for damages to their property.
  • Detached structural damages on your property.
  • A temporary place to stay if a claim stops you from residing in your home during repairs.
  • Instant medical care if a person is injured on your property.

While some policies only offer actual cash value coverage and pay for the depreciated values of your home and properties, the HO-7 insurance policy offers replacement cost coverage for your home, personal property, and other structures.

In better terms, it covers the actual cost of replacing your home after a complete loss or purchasing similar new properties to replace the damaged ones.

What Does an HO-7 Policy Not Cover?

Because HO-7 policy is an open peril policy, it covers every situation except those events listed as exclusions on your policy. There are several types of events covered by the HO-7 insurance policy. These events include:

  • Ordinance or law.
  • Backup of sewer or drain.
  • Neglect
  • Nuclear hazard.
  • Government action.
  • Vandalism of long-term, unoccupied property.
  • Wear and tear.
  • Rust, smog, or corrosion.
  • Dispersal, discharge, or seepage of pollutants.
  • Vermin, insects, birds, and rodents.
  • Earth movements like floods, sinkholes, and mudslides.
  • Power failure.
  • War
  • Intentional loss.
  • Theft of a home under construction.
  • Fungus, mold, or rot.
  • Mechanical breakdown.
  • Smoke from industrial operations or agricultural smudging.
  • Settling, shrinking, bulging, or expanding a structure, such as a foundation.
  • Pets

You can get some of these exclusions as additional coverage on your insurance policy. You can also get them as a standalone if you choose.

Does HO7 Offer Open Peril Coverage for Your Home and Other Structures?

HO-7 insurance policy is an open peril policy, meaning it covers your home and other structures for all causes of damage except those stated in your policy as exclusions.

However, loss events like theft, fire, hail, vandalism, windstorms, and so on are covered by the HO-7 open peril insurance policy.

Does HO7 Offer Named Perils Coverage for Your Properties?

HO-7 policy offers coverage for your belongings slightly differently. Your belongings are covered on a ‘named peril’ basis. This means only losses from events listed in your policy will be covered. These named events include:

  • Fire or lightning
  • Explosion
  • Riot or civil commotion
  • Vehicles
  • Theft
  • Weight of ice, snow, or sleet
  • Freezing
  • Accidental tearing apart, cracking, or burning of a built-in appliance such as a water heater or an oven
  • Windstorm or hail
  • Aircraft
  • Smoke
  • Vandalism
  • Falling objects
  • Overflow of water or steam or accidental discharge
  • Volcanic eruption
  • Sudden and accidental damage from a generated electrical current

Even if an event isn’t listed here, your personal property is not covered by the HO-7 insurance policy. In this case, you can get additional coverage on your policy.