I have received lots of questions lately about insurance, types of coverage, rates, etc. Maybe this article can help:

Taken from http://www.homesecurityinformation.com/types-homeowners-insurance.htm

Types of Homeowner's Insurance (Do You Have What You Need?)

If you're about to buy homeowner's insurance, or you're wondering if it's time to revisit your policy, you should do some research into what's out there. Buying homeowner's insurance may not seem complicated, but in truth, there are quite a few variables. All good homeowner's insurance policies should cover property loss in the event of a burglary, but whether they give you money equaling the value of your old belongings (depreciated dependent on age) or enough to buy new belongings depends on the policy. And what about if there's a fire and you need to rebuild? Today policies in the US are required to cover rebuilding costs 100%. However policies issued before 1990 were not required to cover 100% of the cost of rebuilding your home--do you know when your policy was issued? 

Good agents will help you get exactly the homeowner's insurance that you need at fair rates, but others may be more concerned with getting the sale. It's important for you to know what you want going into the meeting.

HO Numbers

Categories of homeowner's insurance are designated by "HO" numbers. This simply stands for homeowner. Here is a short list of what the various numbers cover:

HO-1: This was the original standard. HO-1 only covers 11 specific types of damage (vehicles, smoke, vandalism, fire or lightning, explosion, riot, aircraft, windstorm or hail, damage by glass/safety glass, theft, and volcanic eruption). Due to its limited nature, HO-1 is not very popular anymore, and has been phased out in many states.

HO-2: HO-2 tends to cost more, but it covers more things including 17 specific dangers. The additional coverage includes damage from water or freezing (pipes/plumbing) on top of the HO-1 items.

HO-3: HO-3 is different from the previous two in that it covers everything except specific dangers. For example, floods usually aren't included (although, you can get separate flood insurance through the government). Your policy will state exactly what isn't covered (this varies depending on which company you go with). HO-3 is more costly than HO-1, but the coverage is more thorough.

HO-4 and HO-6 don't cover buildings, only property, and most have some liability coverage. These homeowners insurance policies are meant for renters and condo owners.

HO-5 is the most comprehensive insurance policy. It runs about 15% more than HO-3. It includes extras that might be unavailable from other policies (i.e. coverage for jewelry, art, antiques, etc.) HO-5 can also include coverage for building code upgrades and sewer backups. By bundling all the extras in one policy, it ends up much cheaper than buying a less expensive policy and adding on all the upgrades.

Despite the guidelines set down by these numbers, there will be some variation from company to company. Make sure to read the fine print carefully.