Questions of Coverage

The most important — and often toughest — part of an adjuster’s job is determining coverage. Each month, Claims publishes a coverage question asked by an insurance professional, along with an answer provided by the dedicated editorial staff of FC&S Online (which, like Claims, is a division of the National Underwriter Company). This month, we take a look at coverage issues for injuries sustained by a guest at a homeowner’s residence.

Question: The policyholder was hosting a Mary Kay make-up party. Once the party was over and the guests were leaving, the claimant ran through the backyard toward the house to notify another guest that they needed to move her car. In the process, the claimant fell and injured a tendon in her ankle and received some bad bruising. Under the HO 3 edition 10 00, “bodily injury arising out of or in connection with a business conducted from an insured location, whether or not the business is owned or operated by the insured or employs an insured, is excluded.” Would you consider hosting a Mary Kay party a business? The policyholder was not paid to host the party; she only received free products and discount coupons.