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Insurance Coverage Experts
HO Coverage for College Student Residing in an Apartment
Your insured’s 21 year old daughter is moving from a dorm to an apartment at college. She has been covered on your family HO and PUP policies but the underwriter now says she needs to get her own policies since she’ll be living off campus? Is that correct?
How to Insure a Condo Owned by an LLC
Sometimes it seems that the insurance industry has a hard time keeping up with “progress” in the rest of the world. From “car sharing” to trusts, emerging exposures often outpace our ability to develop or modify insurance products to address them. So, what if someone forms an LLC to buy a condo? Homeowners? Dwelling? Commercial?
Lawyers Are Reckless: Reasonable Recommendations Result in Uncovered Loss
No need to sugar-coat my opinion about lawyers. But, lest you think I’m just being mean, the crux of this article is that lawyers make reasonable and even good recommendations without knowing the insurance ramifications. An unfortunate loss situation is the basis for this article.
Lawyers Dwell On Small Details: Court Defines “The” -- The Sometimes Overlooked Issue
Attorney Randy Maniloff introduces us to the difference between “the” insured and “an” or “any” insured in the insurance policy. Many ignore these little words (“the,” “an” or “any”) in the policy, but, as Randy states, policy language is king, and these seemingly innocuous words have an amazing affect on coverage.
More About the Danger of Personal Trusts
You have lunch with a customer who tells you he has moved ALL of his personal property and rental properties into a trust. In addition to the immediate awareness on your part that all of his personal lines policies in his name likely no longer include any insurable interest, he tells you he thinks he can cancel all of his personal lines coverages. What do you do?
Trusts: Watch Out – Lawyers Strike Again
Trusts are often used as a means to avoid some of the issues related to probate and estate taxes. However, the lawyers rarely tell insureds that when a trust is set up changes must be made to the homeowners’ policy in the form of specific endorsements as the person’s relationship to the house has changed. We have to ask every year – never assume – because lawyers don’t think about it.
When Can the Name of a Deceased Insured be Removed from a Policy?
Spouses are the named insureds on a homeowners policy. If one of them dies, when should their name be removed from the policy?
Additional Insureds vs. Additional Interests
Increasingly, HO insureds are being asked by third parties to provide evidence of insurance protecting their alleged interests. Unlike CGL additional insured endorsements, which are many and varied, the ISO HO program only provides one AI endorsement and one additional interest endorsement. So, what's the difference and when is each appropriate?
Another Look at Personal Trusts
The insureds are a husband and wife who put their residence into a personal trust as a part of the financial plan they developed with their attorney and CPA. Both have been in declining health for several years and, earlier this year, the wife had to go into a nursing home. A couple of months ago, the husband moved into an Assisted Living Facility. The agency is wondering how to handle their insurance. What they don't know is that it's possible the couple and their trust have NO insurance on the home.
Compared to decades past, MILLIONS more adult children live with their parents today. An estimated 14% of U.S. family households have at least one adult child living at home. Reports indicate that 65% of recent college graduates had moved back in with their parents. The $64,000 (or more) question is, how are they insured?
Complications from a Named Insured's Death
Recently, we had a rash of 'Ask an Expert' questions asking about coverage implications if the named insured dies. In a couple of cases, the insurer was attempting to cancel coverage. In other cases, the insurer wanted to rewrite the policy and/or advised of reduced coverage. In this article, we explore the complications that can arise when an insured dies.
Coverage for Domestic Employees and Independent Contractors
You hire someone on a full-time, part-time, or even one-time basis to do some work at/on your home...housekeeping, painting, roofing, yard work, etc. If that person (employee or independent contractor) is injured, or if that person injures someone else, and you're sued, are you covered under your homeowners policy?
Dealing with Divorce
An age old question in our industry is how an agent or company should respond to coverage change requests for couples that are separating or divorcing. Well, we ALL know that the policies should have been written in BOTH names to begin with...but does that solve the problem? Below is an 'Ask an Expert' question and the responses of our faculty members. As always, if you have anything to add, send an email to Bill.Wilson@iiaba.net.
Divorced Parents and Dual Households
Both the ISO HO and PAP policies cover resident relatives as insureds. What if a covered loss happens to a child whose divorced parents have joint custody? Is the child a resident of mom's or dad's household? In other words, which policy responds to the claim?
HO Coverage for Volunteer Board Service
Many people are often asked to serve in a volunteer capacity as board members on non-profits, school PTA organizations and booster clubs, church boards, and civic organizations. If sued, would these people have any coverage under their homeowners policies?
HO Policies Are NOT for Corporations
At the direction of their accountant, a husband and wife transferred ownership of their secondary residence condominium unit to a closely held family owned corporation, allegedly for tax purposes. Following a loss, the couple filed a claim for direct property damage and loss of use. Think there are any coverage problems?
Homeowners and Additional Insureds
An increasingly common 'Ask an Expert' question we receive has to do with organizations wanting certificates of insurance or worse -- to be named as additional insureds -- on a homeowner's policy. The most common question involves an HO insured using or renting a facility owned by a church, civic organization or municipality. In this article, we'll examine the entire AI issue from a homeowners insurance perspective, including what you can and can't do to comply with these requests.
Insuring "Significant Others"
According to the 2000 U.S. Census, the number of unmarried couples living together grew by 72% since 1990 and now comprise 10% of households. So, on average, the chances are that 10% of your homeowners business involves non-spousal couples. Question: Do they have the proper coverage in place to protect both parties?
Insuring Homes Owned by LLCs
An insured's accountant set up an LLC transferring ownership of his home to his three children as LLC members who now rent the home under a triple net lease to the insured requiring him to insure it. The insured currently has an HO policy in his name. Is there a problem?
Insuring Kids in Your Care
Recently we got an 'Ask an Expert' question regarding liability and medical payments coverage for a foreign exchange student killed while riding the ATV of the family she was staying with. Our commentary on this potential claim may be appropriate in any situation where a non-family member/resident is in the care of an insured.
Insuring Personal Trusts
Sometimes a trust will take ownership/possession of autos, homes or other property. This can occur following an untimely death of an insured or a trust may be established for someone who hasn't reached the age of maturity. Increasingly, trusts are being used in estate planning to convey assets in a manner that attempts to minimize taxes and liability. In any case, such property and the parties involved must be properly insured....
Insuring the Nanny Exposure
In this era of dual income households, kids, elderly parents, hectic schedules and stress, the use of nannies and similar domestic help is growing. A 2002 report by the Center for Child Care Workforce indicated that 13% of children under age 5 were cared for by “paid non-relatives” providing care in the child’s home (includes nannies and similar workers). Do your insureds have this exposure? Are they covered?
Insuring Volunteers - Personal Lines
Many people are often asked to serve in a volunteer capacity as board members on non-profits, school PTA organizations and booster clubs, church boards, and civic organizations, or they may serve as Scouting leaders, athletic coaches, or in other volunteer capacities. Do they have any coverage under their personal lines policies?
Kids in College...Time for an Insurance Review
Well, it's that time of year again when millions of parents' thoughts turn to 'How am I going to pay for another semester of college?!' As discussed in this article, if parents only knew that there was more at risk than tuition, they'd probably think twice about sending their kids off to college!
Live-Ins vs. Guests
In another article, we discussed the insurance implications of co-habitation with 'significant others.' Recently, our 'Ask an Expert' service received a question inquiring as to what distinguished a 'live-in' from a 'guest.' The latter has SOME coverage under the HO policy while the former could possibly be considered a tenant or a roomer or boarder.
Living Together Might Simplify Life, But It Complicates Insurance
Statistics from the 2000 U. S. Census reported that there was a 72% increase in the number of unmarried couples living together in the United States. Newspapers, magazines, and the Internet carried countless articles on the subject. However, for all the opining on the social, economic, moral, and demographic implications of cohabitation, virtually no article addressed the insurance issues. That’s too bad, because there are serious insurance gaps created by the arrangement....
Moving in with Grandma
In these tough economic times, kids and even grandkids are moving in with family members. The question is how does this impact each party's personal lines account and how, if at all, should each one be restructured to recognize this new reality?
Personal Trusts and the HO Policy
While trusts have been around for years, there is an increasing use of them for tax and liability purposes. Only recently has the insurance industry begun to address insurance issues in the personal lines area. The primary problem with using the traditional homeowners policy to insure trusts is that the policy is designed for individuals, not LLCs and corporations.
Roomers and Boarders
An HO client plans on renting two bedrooms in his house to college students. He is a “grandfatherly type” gentleman who lost his wife a year ago and probably would enjoy having the company in his home. And as a retired college professor, he would relish being around college students again. How will this impact his property and liability coverages? Also, would the college students have any coverages under his policy?
The HO Policy and Foster Care
Our 'Ask an Expert' service was recently asked, 'What coverage, if any, does a foster child have under his or her guardian's homeowner (HO-3) policy?' Just a couple of months ago, we were asked a similar question with the added caveat of whether or not the stipend received for foster care could make this an excluded business pursuit.
The Homeowners Policy and College Students
Kids away at college often present unique exposures to loss, many of them potentially catastrophic. So, it's important to know how much coverage if any, is provided by the parents' personal lines package. In this article, based on a question received from a life agent by our 'Ask an Expert' service, we'll examine what HO property coverage is available.
Who is a "Resident" Under a Personal Lines Policy?
Almost every personal lines policy uses the term 'resident' somewhere in the form. A 'resident' relative usually has coverage that is broader than any other class of insured except for the named insured(s). However, few (if any) policies define the term 'resident.' In this article, we'll take a look at how the courts have evaluated residency.