Homeowners Insurance in Missouri

Missouri homeowners insurance provides essential protection for residential properties against perils including fire, theft, wind, hail, and liability claims. Missouri's location in Tornado Alley creates unique coverage considerations.

Standard Homeowners Policy Forms

Missouri uses standard ISO (Insurance Services Office) homeowners forms with state-specific modifications:

HO-3 Special Form (Most Common)

Coverage Structure:

• Coverage A - Dwelling: Open perils (all-risk) coverage on the home structure
• Coverage B - Other Structures: 10% of Coverage A, open perils
• Coverage C - Personal Property: Named perils coverage (typically 50-70% of Coverage A)
• Coverage D - Loss of Use: 20% of Coverage A for additional living expenses
• Coverage E - Liability: $100,000 minimum ($300,000 recommended)
• Coverage F - Medical Payments: $1,000-$5,000 per person

Exam Tip: HO-3 is the most popular homeowners form. The dwelling has open perils (all-risk) coverage, but personal property has named perils coverage. This is a key distinction frequently tested.

Other Missouri Homeowners Forms

HO-2 Broad Form:

• Named perils coverage on dwelling AND personal property
• Less expensive than HO-3
• Covers 16-18 named perils
• Limited coverage compared to HO-3

HO-4 Renters/Tenants Form:

• Personal property coverage only (no dwelling coverage)
• Named perils on contents
• Liability coverage included
• Loss of use coverage for temporary housing

HO-6 Condo/Co-op Form:

• Coverage for condo unit improvements and betterments
• Personal property coverage
• Liability coverage
• Complements condo association master policy

HO-8 Modified Coverage Form:

• For older homes with replacement cost exceeding market value
• Actual cash value coverage (not replacement cost)
• Named perils only
• Lower premiums for historic properties

Exam Tip: Know the difference between HO-3 (open perils on dwelling, named perils on contents) and HO-2 (named perils on both). HO-4 is for renters (no dwelling coverage), and HO-6 is for condo owners.

Covered Perils in Missouri

Open Perils Coverage (HO-3 Dwelling)

Covers all perils EXCEPT those specifically excluded:

Common exclusions include:

• Flood and surface water
• Earth movement (earthquake, landslide, sinkhole)
• Neglect and intentional loss
• War and nuclear hazard
• Governmental action
• Ordinance or law (coverage available by endorsement)

Named Perils Coverage (Personal Property)

Standard Named Perils:

1. Fire or lightning
2. Windstorm or hail
3. Explosion
4. Riot or civil commotion
5. Aircraft
6. Vehicles
7. Smoke
8. Vandalism or malicious mischief
9. Theft
10. Volcanic eruption
11. Falling objects
12. Weight of ice, snow, or sleet
13. Accidental discharge of water or steam
14. Sudden and accidental tearing, cracking, burning, or bulging
15. Freezing of plumbing, heating, AC, or appliances
16. Sudden and accidental damage from artificially generated electrical current

Exam Tip: Windstorm and hail (peril #2) is critically important in Missouri due to severe weather. Know that wind/hail coverage may have separate deductibles.

Missouri-Specific Coverage Considerations

Wind and Hail Coverage

Missouri's severe weather creates special wind/hail provisions:

Wind/Hail Deductibles:

• Separate Deductible: Often 1-5% of Coverage A (dwelling amount)
• Higher Than Standard: Wind/hail deductible typically higher than all-peril deductible
• Percentage-Based: Based on dwelling coverage amount, not flat dollar amount
• Per Occurrence: Applies separately to each storm event

Example: Home insured for $200,000 with 2% wind/hail deductible

• Standard deductible: $1,000
• Wind/hail deductible: $4,000 (2% of $200,000)
• Policyholder pays first $4,000 of wind/hail damage

Exam Tip: Missouri wind/hail deductibles are typically PERCENTAGE-BASED (1-5% of Coverage A), not flat dollar amounts. This is a common exam question. The percentage deductible applies per occurrence.

Tornado Coverage

Tornado Damage Coverage:

• Covered under windstorm peril in homeowners policies
• Wind/hail deductible applies to tornado damage
• Covers direct wind damage to dwelling and structures
• Covers debris removal and tree damage affecting structures
• Additional living expenses if home is uninhabitable

What's Covered:

• Roof damage from high winds
• Broken windows and structural damage
• Damaged fences and detached structures
• Trees falling on dwelling
• Contents damaged by wind or rain entering through wind-damaged openings

Not Covered:

• Flood damage from heavy rains (requires flood insurance)
• Vehicles (covered under auto insurance)
• Trees/landscaping not damaging structures

Exam Tip: Tornado wind damage IS covered under standard homeowners policies in Missouri, but associated flooding is NOT covered. Policyholders need separate flood insurance for water damage.

Ice and Snow Coverage

Missouri winter storms create coverage issues:

Covered:

• Weight of ice, snow, or sleet causing roof collapse
• Ice dam damage to dwelling
• Burst pipes from freezing (if reasonable precautions taken)

Not Covered:

• Freezing pipes if home vacant and heat not maintained
• Gradual ice dam damage from poor maintenance
• Pre-existing roof issues exacerbated by ice/snow

Liability Coverage (Coverage E)

Standard Liability Protection

Coverage E - Personal Liability:

• Protects against lawsuits for bodily injury or property damage
• Covers legal defense costs
• Applies anywhere in the world
• Standard limits: $100,000 (often increased to $300,000-$500,000)

Covered Liability Events:

• Guest injuries on property (slip and fall)
• Dog bites (subject to breed exclusions)
• Accidental property damage caused by insured
• Injuries caused by insured's children
• Liability at secondary locations (vacation home)

Excluded Liability:

• Business activities (requires business policy)
• Intentional acts
• Auto liability (covered under auto policy)
• Professional services

Medical Payments (Coverage F)

No-Fault Medical Coverage:

• $1,000-$5,000 per person typical limit
• Pays medical expenses regardless of fault
• Available to guests injured on property
• No deductible applies
• Supplements liability coverage

Replacement Cost vs. Actual Cash Value

Replacement Cost Coverage

Preferred Coverage Method:

• Pays to replace damaged property with new property of like kind and quality
• No depreciation deduction
• Higher premiums than ACV
• Standard on most modern homeowners policies

Requirements:

• Must maintain insurance to at least 80% of replacement cost
• Must actually replace property to receive full replacement cost
• Partial replacement cost paid initially, balance paid after repairs completed

Actual Cash Value (ACV)

Depreciated Value:

• Replacement cost minus depreciation
• Lower premiums
• Less desirable for homeowners
• Common on older homes (HO-8 policies)

Example:

• Roof replacement cost: $15,000
• Roof is 10 years old (50% depreciated)
• Replacement cost payment: $15,000 (minus deductible)
• ACV payment: $7,500 (minus deductible)

Exam Tip: Replacement cost pays to replace without depreciation. ACV subtracts depreciation from replacement cost. To receive full replacement cost, the property must actually be repaired/replaced.

Missouri Cancellation and Non-Renewal Requirements

Policy Cancellation by Insurer

Missouri law restricts when insurers can cancel homeowners policies:

Cancellation Allowed (First 60 Days):

• Any reason during first 60 days of new policy
• Must provide advance notice

Cancellation After 60 Days (Limited Reasons Only):

• Non-payment of premium
• Fraud or material misrepresentation
• Substantial increase in hazard
• Loss of reinsurance (with Director approval)

Notice Requirements:

• Non-payment: 10 days advance notice
• Other reasons: 30 days advance notice
• Notice must be in writing
• Must state specific reason for cancellation

Non-Renewal Requirements

Non-Renewal Notice:

• 60 days advance written notice required for non-renewal
• Must state reason for non-renewal
• Applies to policies in effect over 60 days
• Protects policyholders from surprise terminations

Exam Tip: Missouri requires 60 days advance notice for non-renewal of homeowners policies. For cancellation due to non-payment, only 10 days notice is required. For other cancellation reasons (after first 60 days), 30 days notice is required.

Additional Coverages and Endorsements

Standard Additional Coverages (Included)

Debris Removal:

• Up to 5% of Coverage A additional
• Covers cost to remove debris from covered losses

Reasonable Repairs:

• Covers cost of temporary repairs to prevent further damage
• No deductible applies

Trees, Shrubs, and Plants:

• 5% of Coverage A limit
• $500 per item maximum
• Only covers named perils (not wind damage)

Fire Department Service Charge:

• Up to $500 for fire department charges
• No deductible

Common Endorsements

Ordinance or Law Coverage:

• Covers increased cost to rebuild to current building codes
• Not included in standard policy
• Essential for older homes

Water Backup Coverage:

• Covers sewer and drain backup
• Not included in standard policy
• Common in Missouri due to heavy rains

Earthquake Coverage:

• Missouri has earthquake risk (New Madrid Seismic Zone)
• Must be added by endorsement
• Separate premium and high deductible (often 10-15%)

Scheduled Personal Property:

• Increased coverage for jewelry, art, collectibles
• Covers perils excluded under standard policy
• No deductible

Identity Theft Coverage:

• Reimburses costs to restore identity
• Legal fees and lost wages
• Typically $10,000-$25,000 limit