The national guide walks through the ISO homeowners forms (HO-2, HO-3, HO-4, HO-5, HO-6, HO-8), Coverages A through F, special limits and conditions. Colorado has passed a long list of homeowners consumer protections, many prompted by wildfire losses. Most are in C.R.S. 10-4-110.6 to 10-4-110.9 and Regulation 5-1-17, and the state exams test them directly.

Scope and underwriting

• In Colorado, homeowner's insurance covers all types of homes: site-built, manufactured, factory-built and mobile homes (C.R.S. 10-4-110.6).
• Underwriting disclosures: if the insurer uses credit or claims history, it must say so during the application. After an adverse action based on the property's claims history, it must disclose the specific claims involved (10-4-110.7(2)).
• Binders and conditional coverage:
  • A binder issued while the risk is evaluated must be identified as only a binder, subject to cancellation (10-4-110.7(1)).
  • The insurer must tell the applicant that coverage is conditional and that it has 30 business days from the effective date to decide and inspect (10-4-110.7(5)).
• Inquiries aren't claims: an insurer may not cancel or nonrenew solely because the insured asked about coverage without filing a claim (10-4-110.8(1)).
• Dog breed: insurers may not refuse, cancel, nonrenew or surcharge based on a dog's breed. They may act on a specific dog known or declared to be dangerous (10-4-110.8(16)).
• Age of home: refusing or limiting coverage solely because of a residence's age is unfair discrimination (10-3-1104(1)(f)(XV)).

Cancellation and nonrenewal

• Notice: at least 60 days, with the specific reasons. For nonpayment, 10 days (10-4-110.7(3)).

Required offers and policy terms

• At application and renewal: the insurer gives an estimate of the cost to reconstruct the home and explains how it was calculated (10-4-110.8(9.5)).
• Required offers (10-4-110.8(6)(a)):
  • law and ordinance coverage of at least 20% of the dwelling limit
  • extended replacement cost of at least 50% of the dwelling limit
• Additional living expense: replacement-cost policies include ALE for at least 12 months, and the insurer must offer up to 24 months in total (10-4-110.8(6)(b)).
• Rebuilding elsewhere: the insured may rebuild at another location or buy an existing home. The land's value is not part of replacement cost (10-4-110.8(13)(f)).
• Contents without an inventory: the insurer must offer at least 30% of the contents limit without requiring a written inventory. The insured may still submit an inventory to recover more (10-4-110.8(11)(a)).
• Time limits after a total loss: the insured has at least 365 days to submit an inventory, and at least 365 days after ALE ends to replace property and recover depreciation (10-4-110.8(11)(c)).
• Suit limitation: since January 1, 2014, a policy may not require suit to be filed sooner than the applicable statute of limitations (10-4-110.8(12)).
• Policy copies: a copy within 3 business days of a request, and a certified copy within 30 days (10-4-110.8(10)).
• Renewals must come with a written description of policy-language changes (10-4-110.8(9)).
• Readability: no higher than a 10th-grade Flesch-Kincaid level, or a Flesch score of at least 50.
• A summary disclosure form goes to homeowners policyholders annually (10-4-111).

Wildfire rules

• Declared wildfire total loss:
  • The insurer must offer at least 65% of the contents limit without an inventory (10-4-110.8(14)).
  • ALE must be available for at least 24 months, with two six-month extensions for delays beyond the insured's control.
  • The insured has at least 36 months from the first ACV payment to rebuild and collect replacement cost, plus two six-month extensions (10-4-110.8(13)).
• Disaster areas (10-4-110.9, Reg. 5-1-17):
  • Insurers may not refuse to issue based on zip code, county or distance from a wildfire, unless the property is in an immediately threatened area (an area under an evacuation or pre-evacuation order).
  • They may not refuse to renew for wildfire-related reasons, but may require reasonable mitigation such as defensible space.
  • If a home in a disaster area is refinanced, coverage continues for the rest of the term.
• Colorado FAIR Plan: a market of last resort for property owners who can't buy coverage from admitted insurers. See the other personal lines guide.

Exam traps

• 60 days' notice for homeowners cancellation or nonrenewal, 10 for nonpayment. Auto uses 30.
• Required offers: 20% law and ordinance, 50% extended replacement cost, 12 months of ALE with an offer of 24.
• Contents without an inventory: 30% normally, 65% after a declared wildfire.
• No breed-based underwriting. Coverage questions are not claims.