P&CTexaseasy
A tenant renting an apartment purchases an HO-4 policy. Which statement correctly describes the HO-4 compared with an HO-3?
AHO-4 covers the building structure in addition to personal property
HO-4 covers the tenant's personal property and liability; it does not include dwelling coverage (Coverage A)
CHO-4 provides open-perils coverage on both the dwelling and personal property
DHO-4 is identical to HO-3 but carries a lower premium because the landlord also insures the structure
Why this is the answer
HO-4 (Renters or Contents Broad Form) is designed for tenants who do not own the building they occupy. Because the renter has no insurable interest in the structure itself, HO-4 excludes Coverage A (dwelling) and Coverage B (other structures). It provides Coverage C (personal property) on a named-perils basis, Coverage D (loss of use / additional living expenses), Coverage E (personal liability), and Coverage F (medical payments to others). The landlord insures the building under a separate policy. HO-4 does not duplicate the landlord's structural coverage — a common misconception.
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