The national guide covers the homeowners forms (ISO HO 00 03 and related forms), Coverages A through F, and the common exclusions. Indiana's state questions on homeowners focus on the residential property termination law (IC 27-7-12): who it covers, the allowed cancellation reasons, notice periods, and banned reasons for termination.

National concepts in brief

• The HO-3 covers the dwelling and other structures on an open-peril basis, and personal property on a named-peril basis.
• The coverages:
  • Coverage B: detached structures.
  • Coverage D: additional living expense or fair rental value.
  • Coverage E: personal liability.
  • Coverage F: medical payments to others, never to insureds or household residents.
• Replacement cost: the HO-3 pays full replacement cost if the dwelling is insured to at least 80% of its replacement cost.
• Ordinance or law: the HO-3 additional coverage lets the insured use up to 10% of Coverage A.
• Proof of loss: a signed, sworn proof of loss is due within 60 days of the insurer's request.
• Exclusions: flood and earthquake are excluded.
• Special limits apply to jewelry, money and similar items.

What the termination law covers (IC 27-7-12-1)

• Covered: real property with up to four residential units, one of which is the named insured's principal residence, plus personal property used in a residence.
• Not covered: inland marine, auto (which has its own law) and commercial policies.
• What "termination" means: a cancellation or nonrenewal. Reasonable deductible or limit changes at renewal don't count (IC 27-7-12-2).

Cancellation (IC 27-7-12-3, 12-6)

• Notice form: written, mailed to the last known address, and stating the effective date. Reasons are given on request.
• Notice periods:

• Allowed reasons after 60 days (IC 27-7-12-6) include:
  • nonpayment;
  • fraud;
  • willful or reckless acts that increase the hazard;
  • code violations that substantially increase the hazard;
  • property taxes delinquent two or more years.

Nonrenewal (IC 27-7-12-4, 12-5)

• Notice: at least 60 days before the policy period ends.
• Explanation: clear enough for a reasonable layperson to understand the basis without asking more questions.
• Late notice: if no notice is given, the policy renews on the same terms when the premium is paid, unless the insured accepted replacement coverage or agreed to the nonrenewal.
• No notice needed when:
  • the insurer showed it was willing to renew (with a bill or renewal offer) and the insured didn't respond;
  • the insured moves to an affiliate with the same or broader coverage.
• Aerial images (from January 1, 2027): a nonrenewal based on aerial images must use photos less than 24 months old, explain how to review them, offer an appeal, and allow at least 60 days to cure (IC 27-7-12-6.5).

Banned reasons for termination (IC 27-7-12-7)

• Occupation alone: except for an insurer that serves only one occupation or a few related ones.
• A prior decline or termination by another insurer.
• Prior coverage through a residual market.

Common exam traps

• Residential cancellation notice: 10 days for nonpayment or in the first 60 days; 20 days after that.
• Nonrenewal notice is 60 days, and the insured must be able to understand the reason without asking.
• Independent producers get notice 10 days ahead of the insured.
• Tax delinquency of two or more years is a valid reason to cancel.
• The law covers only 1–4 unit homes that include the insured's principal residence.