Boat House on Property Leased from Utility Company

August 11, 2016

We insure several lake houses on a lake in North Carolina owned by Duke Energy. The boat houses and docks are on grounds owned by Duke and leased by the homeowners. Is the boat house insured as an other structure or should we be adding other structures away from the residence premises endorsement? Can Duke Energy be added as an additional insured to the homeowners policy? Duke is requiring proof of $300,000 of coverage. If we add Duke, does this cover the leased premises automatically, or do we need the other structures away from residence premises endorsement?

We think we're OK on the liability side as the definition of “insured location” certainly includes the boat house. The definition of “residence premises” includes other structures and grounds at the location; it would seem this is the same location as the “insured location” definition.

North Carolina Subscriber

Since the insured does not own the property the boat houses are on, you should add the other structures away from the residence premises. The fact that it immediately abuts the property makes no difference; it is owned by Duke, therefore for all intents and purposes it is away from the premises.

Duke's concern is liability issues, so an additional insured endorsement is the right way to go. You might want to let underwriting know since this is a little unusual.