ISO routinely surveys the market in order to determine where coverages need to be changed and new coverages need to be developed. A 2016 survey of those between the ages of 18 – 39 showed that this age group has more people living at home with parents or home-sharing with others, in part to save money. ISO discussed these trends with various carriers, and as a result of the survey and discussions with carriers developed the new HO 00 14 Homeowners 14-Contents Comprehensive form HO 00 14 03 22, tailored to the needs of this particular age group. New coverages have been added to meet certain needs, while some coverages that are standard in the HO 00 04 Contents Broad Form have been removed from this form since those coverages are not anticipated to be requested as often. The HO 00 04 Contents Broad Form is available to those whose needs fit that form better. This form has been filed to be effective March 2022. We will update the articles with any changes as they are made so our information is as current as possible. This form, as well as the updated HO 00 03 Homeowners 3 – Special Form are discussed in the updated Homeowners Coverage Guide 6th Edition available here.
We have broken the discussion down into 5 parts. The other sections can be found as follows:
Topics Covered:
AGREEMENT We will provide the insurance described in this Policy in return for the premium and compliance with all applicable provisions of this Policy.
Analysis The agreement is direct and straightforward. For the receipt of premium and adherence to policy provisions, insurance will be provided to the insured as outlined in the policy.
A. In this Policy, "you" and "your" refer to the "named insured" shown in the Declarations and the spouse if a resident of the same household. "We", "us" and "our" refer to the company providing this insurance. B. In addition, certain words and phrases are defined as follows:
1. "Aircraft Liability", "Hovercraft Liability", "Motor Vehicle Liability" and "Watercraft Liability", subject to the provisions in b. below, mean the following:
a. Liability for "bodily injury" or "property damage" arising out of the:
(1) Ownership of such vehicle or craft by an "insured"; (2) Maintenance, occupancy, operation, use, loading or unloading of:
(a) An aircraft, hovercraft or watercraft by any person; or (b) A motor vehicle by any "insured";
(3) Entrustment of such vehicle or craft by an "insured" to any person; (4) Failure to supervise or negligent supervision of any person involving such vehicle or craft by an "insured"; or (5) Vicarious liability, whether or not imposed by law, for the actions of a child or minor involving such vehicle or craft.
b. For the purpose of this definition:
(1) Aircraft means any contrivance used or designed for flight except model or hobby aircraft not used or designed to carry people or cargo; (2) Hovercraft means a self-propelled motorized ground effect vehicle and includes, but is not limited to, flarecraft and air cushion vehicles; (3) Watercraft means a craft principally designed to be propelled on or in water, except model or hobby watercraft not used or designed to carry people or cargo; and (4) Motor vehicle means a "motor vehicle" as defined in 10. below.
Analysis
The definitions section is necessary in any insurance policy so that the insured understands what the carrier means by some terms. As this is a personal contents form, the definitions found here are very close to those found in the HO 00 04 05 11 Contents Broad Form, a discussion of which can be found here.
There are some small differences, however. Under the definition of liability for injury or damage arising out of the ownership or use of aircraft, hovercraft, and other vehicles, the maintenance section is broken out into 2 sections listing maintenance, occupancy, operation, use, loading or unloading of aircraft, hovercraft, or watercraft by any person as one section, and listing those same factors for motor vehicles separately and applying to "insureds", instead of any person. As "insured" is a defined term, this is a difference when it comes to the application of coverage.
The definition of watercraft is different as well. In this form, the definition simply states that a watercraft is a craft designed to be propelled on the water, except for model or hobby craft not used or designed to carry people or cargo. In the HO 00 04 Contents Broad Form, the type of propulsion is included in the definition, so that it states a craft designed to be propelled on or in water by wind, engine power or electric motor. The removal of this language means that watercraft meant to be propelled by oars or sticks would still be considered watercraft.
2. "Bodily injury" means bodily harm, sickness or disease, including required care, loss of services and death that results. 3. "Business" means:
a. A trade, profession or occupation engaged in on a full-time, part-time or occasional basis; or b. "Home-sharing host activities".
4. "Cannabis" means:
a. Any good or product that consists of or contains any amount of Tetrahydrocannabinol (THC) or any other cannabinoid, regardless of whether any such THC or cannabinoid is natural or synthetic. b. Paragraph 4.a. above includes, but is not limited to, any of the following containing such THC or cannabinoid:
(1) Any plant of the genus Cannabis L., or any part thereof, such as seeds, stems, flowers, stalks and roots; or (2) Any compound, by-product, extract, derivative, mixture or combination, such as:
(a) Resin, oil or wax; (b) Hash or hemp; or (c) Infused liquid or edible cannabis; whether or not derived from any plant or part of any plant set forth in Paragraph 4.b.(1) above.
c. Paragraph 4.a. above includes, but is not limited to, marijuana.
5. "Home-sharing host activities" means:
a. The:
(1) Rental or holding for rental; or (2) Mutual exchange of services; of the "residence premises", in whole or in part, by an "insured" to a "home-sharing occupant" through the use of a "home-sharing network platform"; and
b. Any other related property or services made available by an "insured" for use during such:
(1) Rental; or (2) Mutual exchange of services; except those property or services provided by another party.
6. "Home-sharing network platform" means an online-enabled application, website or digital network that:
a. Is used for the purpose of facilitating, for money, mutual exchange of services or other compensation, the rental of a dwelling or other structure, in whole or in part; and b. Allows for the agreement and compensation with respect to such rental to be transacted through such online-enabled application, website or digital network.
7. "Home-sharing occupant" means a person, other than an "insured", who:
a. Has entered into an agreement or arranged compensation with an "insured" through the use of a "home-sharing network platform" for "home-sharing host activities"; or b. Is accompanying or staying with a person described in Paragraph 7.a. above under such "home-sharing host activities".
Analysis
The definition of "bodily injury" is the same as that of the HO 00 04. "Business" now includes "home-sharing host activities" as part of the definition, and it is itself a defined term that will be discussed later.
Because of the significant changes throughout the country in the legalization and availability of cannabis products, "cannabis" is now a defined term. The definition does not distinguish between cannabis and hemp, and defines "cannabis" as any good or product containing any amount of tetrahydrocannabinol (THC) or other cannabinoid, whether natural or synthetic. The definition continues and lists products that are included in the definition of "cannabis", but this list is not exhaustive. Included are any plants of the genus Cannabis L., and this includes all parts of the plant, from roots to seeds, stems, stalks, and flowers. Likewise, any compound, by-product, extract, derivative, mixture or combination of the same is also considered to be "cannabis". Included in this are resins, oils, waxes, hash or hemp, infused liquids or edibles whether or not derived from any plant containing THC. This includes but is not limited to marijuana. The definition is detailed so that it is clear that any such product containing THC, regardless of name or form, is considered to be "cannabis".
"Home-sharing host activities" is the next definition. Home-sharing became popular a number of years ago when people started renting out their homes to tourists traveling to their hometown. The homeowners might or might not be on premises, and home-sharing became a popular way to travel as the rentals were often cheaper than hotel stays and some hosts might show the renters around the area.
As with ride-sharing, home-sharing involves a network application that allows those willing to share their homes to connect with those wanting to rent a home in a particular area. The policy specifically defines "home-sharing network platform" as an online enabled application, website or digital network that is used to allow those willing to rent their premises to connect with possible renters and make arrangements and agreements regarding the rental and exchange funds or other compensation through the network.
Likewise, the occupants renting the premises through the "home-sharing network" need to be defined. "Home-sharing occupant" is defined as someone other than an "insured" who has made an agreement with an "insured" through a "home-sharing network platform" for the rental of the premises or the person staying with the occupant who is renting the premises. For example, Joe the insured decides to make a little money on the side renting his spare bedroom to travelers coming to his town. He signs up with the network and starts renting out his spare room when there is some big event going on in town that people travel to see. When these travelers stay with him he often shows them around the town. Joe is engaging in "home-sharing host activities" when he does this.
8. "Insured" means:
a. You and residents of your household who are:
(1) Your relatives; or (2) Other persons under the age of 21 and in your care or the care of a resident of your household who is your relative; or
b. Under Section II with respect to animals to which this Policy applies, any person or organization legally responsible for these animals which are owned by you or any person described in 8.a. "Insured" does not mean a person or organization using or having custody of these animals in the course of any "business" or without consent of the owner. Under both Sections I and II, when the word an immediately precedes the word "insured", the words an "insured" together mean one or more "insureds".
9. "Insured location" means:
a. The "residence premises"; b. Any premises used by you in connection with the premises described in a. above; c. Any part of a premises:
(1) Not owned by an "insured"; and (2) Where an "insured" is temporarily residing; or d. Any part of a premises occasionally rented to an "insured" for other than "business" use.
10. "Motor vehicle" means:
a. A land or amphibious vehicle that is self-propelled or capable of being self-propelled; or b. Any trailer or semi trailer which is being carried on, towed by or hitched for towing by a vehicle described in 10.a. above.
11. "Occurrence" means an accident, including continuous or repeated exposure to substantially the same general harmful conditions, which results, during the policy period, in:
a. "Bodily injury"; or b. "Property damage".
12. "Property damage" means physical injury to, destruction of or loss of use of tangible property. 13. "Residence premises" means that part of any dwelling where you reside, which is shown as the "residence premises" in the Declarations. "Residence premises" includes other structures and grounds at that location.
C. In this Policy, the terms:
1. Roomer; 2. Boarder; 3. Tenant; or 4. Guest; do not include a "home-sharing occupant"
Analysis
There are some significant differences in the definition of "insured" between the HO 00 14 and the HO 00 04. The HO 00 14 removes the status of students away at school under the age of 24 as insureds, and under Section II removes coverage for people or organizations legally responsible for watercraft owned by the insured as long as the person does not have custody of the watercraft as part of a business or without the consent of the insured. Coverage for those in possession of the insured's animals still exists, so the teenager who is dog-sitting for the insured is still covered should there be an accident. Likewise, the definition of "insured" relative to "motor vehicles" to which the policy applies has been removed as well.
The definition of "insured location" has been modified as well. While the HO 00 04 definition mirrors the definition found in the HO 00 03 Homeowners form, the HO 00 14 does not. "Insured location" includes the "residence premises", any premises used by the insured in connection with the "residence premises", part of a premises not owned by the "insured" where the "insured" is temporarily residing, and lastly any part of a premises that is occasionally rented to the "insured" as long as it is not used in "business". Vacant land, land on which a dwelling is being built, and cemetery plots are not considered part of an "insured location" under this policy form. "Residence premises" is defined as that part of any dwelling where you reside, which is shown as the "residence premises" in the declarations.
Definition of "Insured Location"
| HO 00 03 and HO 00 04 | HO 00 14 |
| "Residence premises" | "Residence premises" |
| Part of other premises, other structures and grounds used by you as a residence and which is shown in the declarations or is acquired by you during the policy period for your use as a residence | Any part of a premises used in connection with the "residence premises" |
| Any part of a premises used in connection with a premises described above | Any part of a premises not owned by an "insured" and where an "insured is temporarily residing or |
| Any part of a premises not owned by an "insured" and where an "insured is temporarily residing | Any part of a premises occasionally rented to an "insured" for other than "business" use |
| Vacant land other than farm land, owned by or rented to an "insured" | |
| Land owned or rented to an "insured" on which a one-, two-, three- or four-family dwelling is being built as a residence for an "insured" | |
| Individual or family cemetery plots or burial vaults of an "insured" | |
| Any part of a premises occasionally rented to an "insured" for other than "business use" |
While worded slightly different, the definition of "motor vehicle" is describing the same thing, land or amphibious vehicles that are or can be self-propelled, or trailers that can be hitched to such vehicles.
The definitions of "occurrence" and "property damage" remain the same. No definition of "residence employee" is included in the HO 00 14, and "residence premises" is defined as simply the part of any dwelling where you reside that is shown as the "residence premises" in the declarations, including other structures and grounds at that location. It is not specified that it is a one- to four-family dwelling.
A separate section is set out that is not exactly a definition, but outlines types of residents that would not be considered "home-sharing occupants". Those are roomers, boarders, tenants, or guests. The difference between roomers, boarders, tenants and guests is often confusing. Guests are easy, they are those who visit with the insured for a short period of time and do not pay the insured for their hospitality. None of these terms are defined, but it is important to understand the difference. When terms are undefined courts turn to a standard desk reference.
Merriam Webster online defines the terms as follows:
Roomer – one who occupies a rented room in another's house. Boarder – one that boards, especially one that is provided with regular meals or regular meals and lodging. Tenant – one who rents or leases a dwelling (such as a house) from a landlord Guest – a person entertained in one's house, a person to whom hospitality is extended
Remember that a "home-sharing occupant" is a person who has entered into an agreement or arranged compensation with an insured through the home-sharing platform where in exchange for said compensation the "home-sharing occupant" has use of the "insured's" premises for a given period of time.
Includes copyrighted material of Insurance Services Office, Inc., with its permission.