On April 16, 2010, ISO announced the filing of its new 2011 countrywide homeowners program, along with the mobilehome supplement to the program. This long-awaited new program will be filed in all jurisdictions except Hawaii, North Carolina, Virginia, and Washington. A proposed effective date for the vast majority of jurisdictions is May 1, 2011.
Some of the key changes in the 2011 program include the following.
- In response to caselaw, the definition of “insured” is amended. One court ruled that the phrase “any person named above” in the existing definition could have more than one interpretation and was thus ambiguous. This reference is thus deleted so that other resident persons under age 21, if they are in the care of any resident relative, are included within the “insured” definition.
- The deductible provision is clarified to explicitly state that it applies on a per-loss basis. It also stipulates that when two or more deductibles pertain to a loss, the highest deductible applies. A broadening of coverage is provided with this latter change. The provision is also relocated in the Section I conditions since it applies only to Section I losses.
- Personal property located in self-storage facilities are now explicitly referenced with an applicable sublimit of 10 percent of the personal property limit. Increasing this limit can be achieved via a new endorsement.
- Introduction of a $250 sublimit for antennas, tapes, wires, records, and other media that are in or upon a motor vehicle is a lessening of coverage. Conversely, a sublimit increase from $500 to $1,500 for property off the residence premises but used primarily for business purposes is a broadening provision.
- More clarity is provided to collapse coverage, in response to caselaw. One court said the existing provision provides coverage not only for a collapse loss, but also for the risk of loss involving a collapse. This provision could be interpreted as providing coverage for a building in danger of falling down. As a result, the language is firmed up to indicate that only an abrupt collapse resulting from specified named perils is covered.
- Related to the above collapse provision amendment, the phrase “risk of” is deleted from the “perils insured against” provision. The lead-in phrase now says “We insure against direct physical loss …”
- Loss from “vermin” is deleted since it lacks a scientific definition and can be interpreted in numerous ways. In addition, any loss arising from the nesting or infestation of any animals or the discharge of any waste products or secretions by such animals is explicitly excluded. The first change broadens coverage, and the second change reduces coverage.
- Theft coverage is broadened for an insured who is a student living away from home. Personal property coverage for the student while at the residence he or she occupies to attend school is expanded to apply as long as the student has been at the residence at any time during the 90 days (up from 60 days) immediately before the loss.
- An amendment to the earth movement exclusion is made to track for consistency purposes with the revised water exclusion. It reinforces the scope of the exclusion to apply whether caused by an act of nature or otherwise caused.
- The water exclusion is amended to incorporate the language contained in the mandatory water exclusion endorsements introduced in 2009.
Liability coverage for motor vehicles used to service a residence is expanded so that a loss arising from a motor vehicle that is occasionally used to service any residence (e.g., a neighbor’s yard) is covered.
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