Purchasing a home insurance plan has become mandatory for both the mortgage lender and a homeowner as it protects the property from unexpected perils. There are several types of home insurance plans available in Montana. Here is a list of the basic types of home insurance policies:

• H01: This is a basic type of policy that offers coverage for a home against eleven listed perils. Contents within the home are usually included in this form of coverage but have to be clearly enumerated. The list of perils are:

1. Fire or lightening

2. Windstorm or hail

3. Vandalism

4. Theft

5. Damage resulting from vehicles or aircraft explosion

6. Civil commotion or riot

7. Glass breakage

8. Volcanic eruption

9. Fire

10. Smoke

11. Personal liability

Damages due to floods and earthquakes are not covered within this policy.

• HO2: This is an advanced form of Montana home insurance policy. In addition to all the coverage listed in H01 type of home insurance, it also includes these:

1. Bodily liability

2. Medical liability

3. Legal defense in cases of liability

4. Legal costs incurred in defending liability cases in a court

• HO3: This is called all risk home insurance policy and is the most comprehensive type of policy suitable especially for single family houses. It covers all kinds of risks associated with home excluding earthquakes and floods.

• HO4: This form of home insurance policy in Montana is for renters and provides coverage for personal property against the similar form of perils as listed in HO2.

• HO6: This is a condominium policy created for condominium owners.

• HO8: This type of policy is for older houses whose replacement cost is much higher than the market value of the property.

Coverage

For each of the policies, there are usually six coverage classifications. Property coverage includes:

• Dwelling (Coverage A): This refers to the coverage for the cost of the dwelling only, excluding the land. If the dwelling has been insured up to 80% of its actual value, it stands to be replaced

• Other structures (Coverage B): This refers to coverage for other structures near the property that are not utilized for business purposes, like a private garage. It is limited to 10% of Coverage A.

• Personal property (Coverage C): Generally 50 to 70% of the category of coverage A is needed for coverage of personal property or contents.

• Additional living expenditures (Coverage D): This includes coverage for rental expenses.

• Additional coverage: This gives a coverage for a great variety of expenditures like reasonable repairs, debris removal, damage caused by shrubs and trees, credit card or identity theft or loss, landlord's furnishing as well as building additions.

Special exclusions include water damage, earth movement, power failure, war, neglect, nuclear hazard as well as purposeful loss.

These are the general categories of insurance. Do remember that wordings and coverage might vary from one Montana home insurance company to another. Always read through and try to understand each policy documents before finalizing on the purchase.