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If you think you do not need home insurance just because your property does not lie in a flood plain or a potentially dangerous seismic zone, you have another think coming.

Homeowners Insurance Policies in Illinois

Though addressed by different names (such as HO-2 = Silver Policy; HO-3 = Gold Policy, and HO-5 = Platinum Policy) the standard homeowners policies in Illinois are:

1. Broad Form (HO-2) – This covers only the names perils listed in the policy.
2. Special Form (HO-3) – This accords cover for your property and liability with respect to the dwelling, other structures in your premises, and loss of the dwelling and other structures due to the named perils listed in your policy (e.g., fire, lightning, windstorm and hail, falling objects, etc.). Personal property is also covered for perils listed in your policy. HO-3 is more comprehensive than HO-2.
3. Comprehensive Form (HO3/HO5) – This policy provides the broadest coverage available for all perils not specifically excluded in your policy. Note that it is not offered by all insurers and is usually more expensive.
4. Tenants Form (HO-4) – This covers a renter's personal property, liability, and additional living expenses (ALE).
5. Condominium Form (HO-6) – This covers a condo unit, personal property and any additions and alterations made to the inside of your unit. Condominium owners can also buy additional cover for any liability associated with their holdings in the condominium association's common ownership.
6. Modified Coverage Form (HO-8) – This offers cover when replacement costs for an older home surpass its market value.

Additional Covers

Apart from the known Flood Insurance Covers, Liability Coverage, Medical Payments Coverage, Property Coverage and ALE, there are a few others, which exist.

1. Personal Property Replacement Cost – This replaces your personal belongings such as furniture, appliances, clothes, jewellery, and bicycles without deducting the depreciation. Reimbursement is based on what it would cost you to buy a new item of similar make and material at today's cost, not the depreciated actual cash value.
2. Building Guaranteed Replacement Cost – This enables you to rebuild your home even if it costs more than the policy limit (usually restricted to a certain percentage above your policy's limit: e.g., 20%). This is the most comprehensive coverage you can buy for your home.
3. Refrigerated Products – If goods in your refrigerator or freezer have been damaged then this cover takes care of things.
4. Business Insurance - Limited cover for your business machines, tools, and liability is accorded by this policy. If you run a business from your home, then, look out for this.
5. Earthquake Insurance – All earthquake related damages are paid for by this cover.
6. Inflation Guard – Your cover limits will automatically rise annually based on the inflationary trends.
7. Mine Subsidence – This will cover you when an underground mine shifts, damaging your property. These insurances are offered in counties where mining activity is prevalent and where mines are located under one percent or more of the land. This is common in central and southern Illinois.
8. Scheduled Personal Property (also called a "floater") – This pays for damage to special personal belongings of great value like jewellery, furs, coins, computers, antiques, artwork, and silverware. Payment for these items is usually limited under a homeowner’s policy.
9. Sewer Backup and Sump Pump Overflow Endorsement – This covers all damages to your finished basement resulting from the sewer backup or sump pump overflow. Even if your basement isn't finished, some contents may still be covered.
10. Increased Limits on Money and Securities Endorsement – This covers money, bank notes, securities, deeds, etc.
11. Watercraft Endorsement - All liability and medical payments cover for damage or injury caused by small sailboats and outboard motor boats are provided by this policy.

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