State Farm Fire Independent Policy Practice Exam

Which type of coverage is not typically included under a standard HO-3 policy?

1. Personal property damage

2. Structural damage

3. Flood damage

4. Theft of personal belongings

The correct answer is: Flood damage

Flood damage is not typically included under a standard HO-3 policy because this type of homeowners insurance primarily covers damage resulting from perils like fire, theft, and vandalism related to the home and personal property. The HO-3 policy provides broad coverage for the structure of the home and personal belongings against many types of risks, but natural disasters such as floods require separate flood insurance, which is often provided through the National Flood Insurance Program (NFIP). This distinction is important because it highlights the differences in coverage provided by standard homeowner policies compared to specialized policies for specific risks, such as flooding. Thus, while personal property damage, structural damage, and theft of personal belongings are commonly covered under the HO-3 policy, flood damage is excluded and necessitates additional coverage.