Which coverage form is considered when the replacement value of an old house exceeds its market value?

The correct coverage form to consider when the replacement value of an old house exceeds its market value is the HO 8 modified coverage form. This form is specifically designed for older homes that may not have a market value that aligns with their replacement costs. Traditional homeowner policies, like HO 3 or HO 5, provide coverage based on the market value, which can be problematic in cases where the cost to rebuild is significantly higher than the home's worth.

The HO 8 form allows for coverage on a more favorable basis for these unique situations by focusing on the cost to repair or replace the home rather than market value. This is particularly important for older homes that may have costs associated with preserving their historical character or specific architectural details that aren't reflected in current market prices.

In contrast, the other forms listed, such as the HO 3, HO 5, and HO 4, are more tailored to standard insurance needs and do not account for homes whose replacement costs far exceed their market values. Hence, the HO 8 is the most suitable option for addressing the particular needs of homes in this scenario.