1. Forms
2. CA
3. CA-25-10

What the form is

The CA 25 10, currently titled "Damage To Rented Premises Liability Coverage – Garages," is an endorsement to the Garage Coverage Form. The standard Garage Coverage Form typically excludes property damage liability for premises rented to or occupied by the insured. This endorsement modifies that exclusion by providing legal liability coverage for damage to such premises. Initially known as "Fire Legal Liability Coverage – Garages," its scope was expanded in later editions to cover more than just fire damage, particularly for short-term rentals.

Classes of business it applies to

This endorsement is specifically designed for businesses with garage operations. This includes, but is not limited to:

• Automobile repair shops
• Service stations
• Car dealers
• Businesses that rent or occupy premises for their garage-related activities

For example, if an auto repair shop rents a building and a fire (or another covered peril under later editions) damages the rented structure due to the shop's negligence, this endorsement would provide coverage for the shop's legal liability, subject to the policy limits and terms.

Special considerations

• Scheduled Premises: Each premises to be covered by this endorsement must be specifically described in the endorsement schedule.
• Limit of Insurance: A specific limit of insurance applies to this coverage, which is stated in the schedule. The 03 10 edition, for instance, specified a standard limit of $100,000 unless a different limit was shown. This limit is subject to the aggregate limit for 'Garage Operations – Other Than Covered Autos'.
• Short-Term Rentals: Revisions, such as the 03 10 edition, broadened the coverage to include property damage (not just by fire) to premises, including their contents, that are rented to the named insured for a period of seven or fewer consecutive days.
• Excess Coverage: The insurance provided by this endorsement is typically excess over any other collectible property insurance available to the insured for the damaged property.
• Title Change: It's important to note the title change. Prior to the 03 10 edition, the form was generally known as "Fire Legal Liability Coverage – Garages." The change to "Damage To Rented Premises Liability Coverage – Garages" reflects the broadened scope of coverage.

Key information for agents and underwriters

• Addressing a Gap: This endorsement is crucial for covering a significant exposure that is otherwise excluded by the standard Garage Coverage Form – liability for damage to non-owned premises in the insured's care, custody, or control for their garage operations.
• Risk Assessment: Underwriters should carefully assess the nature of the rented premises, the insured's operations, and existing fire and safety precautions. The type of construction, occupancy, and any hazardous operations will influence the risk.
• Pricing: The premium for this endorsement is typically based on the limit of insurance selected and the underwriter's assessment of the risk associated with the scheduled premises.
• Edition Dates: Agents and underwriters must pay close attention to the edition date of the CA 25 10 used, as coverage provisions, limits, and titles have changed over time. For example, the broadening to include contents and non-fire damage for short-term rentals was a key change in later editions.
• Coordination with Other Coverage: It's important to understand how this endorsement interacts with other property or liability coverages the insured may have.