Hawaii Insurance License Practice Exam

What type of dwelling does an HO6 policy primarily cover?

1. Single-family homes

2. Rented apartments

3. Condos

4. Townhomes

The correct answer is: Condos

The HO6 policy, also known as a condominium unit owners policy, is specifically designed to provide coverage for owners of condo units. This type of policy is tailored to address the unique needs of condominium living, where the owner is responsible for the interior of their individual unit while the homeowners association (HOA) typically covers the exterior and common areas. An HO6 policy covers personal property, liability, and certain structural elements within the unit, such as walls, floors, and fixtures that the homeowner is responsible for according to the condo association's bylaws. Because the policy is focused on the individual owner's interests within a multi-unit building, it directly aligns with the structure and ownership model of condominiums. On the other hand, single-family homes, rented apartments, and townhomes fall under different insurance categories and coverage types. Single-family homes are typically insured under an HO3 policy, which is for home owners. Rented apartments usually require renters insurance, which protects the tenant's personal property rather than the structure itself. Townhomes are often insured through similar policies as single-family homes but may have specific policies depending on the association's coverage. Thus, the HO6 policy is distinctly suited for condominium unit owners.