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Last Post 04/07/2011 12:09 PM by  Ray Hall
What's In A Definition? - Residence premises
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CatAdjuster.org Founder

04/06/2011 8:49 AM

    From the ISO HO3 4/91 

     "Residence premises" means:

    a. The one family dwelling, other structures, and grounds; or
    b. That part of any other building;

    where you reside and which is shown as the "residence premises" in the Declarations.
    "Residence premises" also means a two family dwelling where you reside in at least one of the
    family units and which is shown as the "residence premises" in the Declarations.
    For Discussion.
    You receive a hail claim for a dwelling insured under the above policy.  While at the risk you notice a For Sell sign in the yard and the insured tells you that he moved away about three months ago and was just letting a friend live in the home until he sold the house.  You found hail damage to the roof.  Is there coverage?
    Advanced Member
    Advanced Member

    04/06/2011 12:26 PM
    The carrier can and often will deny the claim. The adjuster needs to gather the facts (obtain evidence) and submit it to the company for consideration. The insured is required to notify the carrier when he turns his primary residence into a rental. The insurance company did not agree to insure a rental. The carrier might pay the claim if it has only been a short time that the insured moved out. If the insured never lived in the house, but claimed he did on the application (fraud), there will more likely be a denial. The carrier can deny the claim and return the premiums that were paid. Each state has different case law regarding these issues, but just based on the written contract the carrier can deny the claim.

    Some examples of evidence the adjuster can gather:

    copy of lease
    photograph of rent check
    statement from neighbor
    photograph of utility bill with tenants name on it
    recorded interview with insured
    recorded interview with tenant
    photograph of tenant's driver's license with the address
    photograph of mailbox with tenant's name on it.

    The easiest time to gather evidence is the first inspection/first phone call. The adjuster should gather evidence so that the carrier can make an informed decision that can be defended by the evidence if necessary.

    Here is an article for a Michigan attorney regarding this issue:

    Ray Hall
    Senior Member
    Senior Member

    04/07/2011 12:09 PM

    Insurors have always had the right not to insure  a risk of greater than usual hazards. A tenant occupied dwelling could be higher than an owner dwelling.

    What would you do if a dwelling was rated as owner occupied 5 years ago with a HO-3 and the policy has been renewed 4 times and the property was vacated by the owner and rented for the last 4 years and now has a small windstorm loss on the roof with the same coverage that was placed 5 years ago.?

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