THE NEW ISO HOMEOWNERS INSURANCE CHANGE: PREVENTING FINANCIAL DISASTER

Published on Nov 18, 2015

ISO has just launched new Homeowners insurance endorsements to fix a problem that could be catastrophic for homeowners. This slideshow explains the problem and ISO's solutions.

PRESENTATION OUTLINE

THE NEW ISO HOMEOWNERS INSURANCE CHANGE:
PREVENTING FINANCIAL DISASTER

ISO’s Homeowners 3 Special Form policy covers the dwelling at the “residence premises.”

Photo by chefranden

The form defines “residence premises” as the dwelling “where you (the named insured) reside.”

What happens when the named insured stops residing there?

Photo by netmonkey

People sometimes relocate for jobs on a moment’s notice.

People vacate a home because the bank is foreclosing.

Photo by taberandrew

People buy a home but don’t move in because they’re renovating.

Photo by SWIMPHOTO

People buy a home but let the sellers live there for a few days after closing.

Photo by Gideon Tsang

People sell a home and move out before the closing.

Photo by kozemchuk

People move out of state and let their children live in their old home.

Photo by Rafael Acorsi

People get divorced. Sometimes, the policy's only named insured is the spouse who moves out.

Photo by Ed Yourdon

People go into the hospital.

Instead of going home, they go to an assisted living facility. Or a hospice.

What happens to their Homeowners coverage when they do these things?

Photo by vonSchnauzer

Some insurers have denied coverage for damage to the dwelling;
damage to other structures;
and loss of use.

Photo by dvs

They have said that the dwelling is not at the “residence premises” because the named insured doesn’t reside there.

Photo by [AndreasS]

A number of state courts have agreed with the insurers.

Photo by IslesPunkFan

In New York, one insurer denied coverage to someone who was renovating a house before moving in.

Photo by haglundc

In 2012, the New York State Court of Appeals ruled against the insurer.

Four judges voted against the insurer, three voted in favor.

IIABA has fought this for years.

In November 2014, IIABA’s Technical Affairs Committee worked out a solution with ISO.

Photo by bmooneyatwork

The TAC includes agents from Iowa, Missouri and Texas and association staff from the IIABA and
New York.

Photo by NinJA999

ISO has introduced new endorsements to carry out the solution

Photo by BlakJakDavy

They will be effective in October 2015.

Photo by ginnerobot

Untitled Slide

Untitled Slide

Untitled Slide

The “Residence Premises Definition Endorsements” will be mandatory on all policies.

Photo by Enokson

They define “residence premises” as the dwelling where the named insured resides on the policy’s inception date.

Photo by twid

Residency requirement is met if the insured resides in the home on the inception date.

Photo by roger4336

Named insured will have coverage even if she stops residing there mid-term.

Photo by Exothermic

Renewal policy will not provide coverage if named insured does not reside in home on renewal date.

ISO has developed a questionnaire for underwriters to use to determine residency.

Photo by Joe Gratz

Untitled Slide

Endorsement has fields for inception/termination dates.

Between these two dates, the policy will not have a residency requirement.

Photo by Neubie

Example: Insured will not move into home until renovations are complete. She expects them to take six weeks.

Photo by cafemama

Broadened Residence Premises Definition Endorsement should be attached

Inception date = Policy inception date

Photo by Louis Abate

Termination date = Latest date she expects to move in

Photo by TC Morgan

If policy inception date is July 1, endorsement’s inception date should also be July 1.

Photo by DafneCholet

Termination date should be much later than expected, just to be safe.

The Broadened Residence Premises Definition Endorsements are optional and replace the mandatory endorsements.

Photo by Stella Dauer

ISO has started filing these endorsements in the states.

Photo by Antonio Viva

As of June 5, 2015, they have not been approved in New York.

Photo by caruba

More info & download the endorsements at:
http://www.independentagent.com/Education/VU/Pages/featured-resources/reside/WhereYouReside2015.aspx

Go to http://www.independentagent.com/Education/VU/Pages/featured-resources/reside/WhereYouReside2015.aspx.

Find out more at www.independentagent.com/Education/VU/Pages/featured-resources/reside/where-you-reside.aspx

Find out more at www.independentagent.com/Education/VU/Pages/featured-resources/reside/where-you-reside.aspx.

Untitled Slide

Timothy Dodge

Haiku Deck Pro User