What Is an HO-8 Insurance Policy? Modified Coverage Explained

An HO-8 policy is a form of homeowners insurance for older and historic buildings that may not qualify for standard coverage, since their rebuild value often exceeds their current market value. However, while HO-8 home insurance helps provide essential protection for these properties, an HO-8 insurance policy is more limited in its coverage.

Keep reading to learn more about HO-8 policies, how they work and whether one may meet your needs.

On This Page

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  What Is an HO-8 Policy?

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  How Does an HO-8 Policy Work?

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  What Does an HO-8 Policy Cover?

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  Who Needs an HO-8 Policy?

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  How To Get Insurance for Older Homes

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  FAQs

What Is an HO-8 Policy?

Also called Modified Coverage Form 8, an HO-8 policy is a type of home insurance for historic homes and older properties constructed more than 40 years ago. HO-8 home insurance provides several types of coverage, including dwelling, personal liability and additional living expenses.^[1][2]

This type of policy is intended for homes with a replacement cost significantly higher than their market value, or where the means to repair or restore aspects are difficult to reproduce, antiquated or use materials that are harder to source. However, to offset the higher risk of an expensive claim, an HO-8 insurance policy offers more limited coverage than standard homeowners insurance.^[2]

Is an HO-8 Policy the Same as an HO-3 Policy?

HO-8 policies are more limited than HO-3 policies, covering only named perils for dwelling coverage. Here’s a quick breakdown comparing the two types of homeowners policies:^[2]

How Does an HO-8 Policy Work?

HO-8 policies function similarly to standard homeowners policies, offering reimbursement after you file a qualifying claim. However, much like an HO-1 policy, an HO-8 insurance policy employs a more limited named-peril form rather than the broader open-peril coverage that other types of homeowners insurance offer. We’ll discuss these limitations later.

Additionally, when making a claim, you typically need to account for your deductible, which is the amount you’re responsible for paying during the policy period. Lower deductibles often result in higher premiums, while raising your deductible can lower your premium, since you’re opting to cover more of the financial risk.

While there is often flexibility in choosing your deductible amount, ensure you don’t select one that is too high to manage, or you may face a financial burden when filing a claim.

Do HO-8 Policies Pay at Replacement Cost?

HO-8 policies typically pay on an actual cash value (ACV) basis instead of replacement cost, which accounts for depreciation when reimbursing a claim. Older homes may be at higher risk of damage than newer homes because some of their bespoke features — such as decorative moldings, stained glass windows and hand-carved architecture — are much more expensive to replace or repair. By using ACV, insurance companies help keep premiums lower while still providing homeowners with essential coverage.

What Does an HO-8 Policy Cover?

HO-8 insurance coverage operates on a named-peril basis — you're covered for ONLY the specific perils named in your policy. You can find more details about your coverage on the declaration page of your policy, which you should review to understand any of the policy’s limitations.

Out of the 16 most common perils, you are protected against only 10. Below, we’ll quickly break down what perils are typically covered:^[2]

With dwelling coverage, the structure of your home is protected against the ten named perils listed in your policy. Your personal liability coverage will pay for legal costs if you're financially responsible for the property damages or injuries of someone else on your property. HO-8 insurance will cover your personal belongings for damage or loss due to one of the named perils listed in your policy.

Keep in mind that the reimbursement will be based on ACV, so you should consider how your home has depreciated over time when determining coverage options.

Also called loss of use coverage, HO-8 insurance will pay for your daily living costs if you need to stay elsewhere because your home is uninhabitable. For example, you may receive compensation to stay in a hotel if your home is being repaired after a fire.

What Isn't Covered?

As mentioned, HO-8 policies don't cover all 16 common perils. While you have coverage for several external perils, you're at risk for falling objects and damage to your home systems and appliances, such as freezing, accidental tears and power surges.^[2]

Like many standard home insurance policies, the following events would also not be considered a covered loss on HO-8 policies either:^[2]

• Earthquakes
• Flood
• Government acts
• Hurricane
• Infestation of animals and pests
• Mold
• War
• Wear and tear
• Pet damages

With so many holes in your coverage, you should consider further protecting your home and belongings. While older homes are riskier, some insurance providers may sell you a separate policy to cover earthquakes, flood damage or another type of risk. You can also see if your issuing insurance carrier would allow you to add coverage via an endorsement to your existing policy, which will cause your insurance premium to increase depending on the added cost.

Who Needs an HO-8 Policy?

Those who should most consider an HO-8 policy include homeowners of:

• Older homes, particularly those at least 40 years old
• Registered landmarks
• Homes with a significant or unique architectural design
• Homes that are built out of difficult-to-replace materials

How To Get Insurance for Older Homes

You should shop around among different insurance companies to better understand your options, including whether your home qualifies for standard homeowners insurance or if an HO-8 makes more sense. Try to get three to five quotes to help you compare prices and coverages. You’ll typically need to provide information about your home's age, value, recent renovations and location.

Keep in mind that this process can become tedious and time-consuming, as you’ll often need to get quotes from each insurance company individually. Speed up this process by using an insurance marketplace like SmartFinancial. After a brief questionnaire, we’ll connect you with a licensed insurance agent to help you get the coverage that meets your needs. Click here for a free homeowners insurance quote today!