1. Forms
2. DL
3. DL-24-33

What the form is

The DL 24 33 "Worker's Compensation Residence Employees – California" is an endorsement to a dwelling insurance policy in California. Its primary function is to provide workers' compensation benefits for residence employees who are injured or become ill as a direct result of their work for the insured. This coverage is subject to California's workers' compensation laws and typically includes medical expenses, disability income, and death benefits for covered domestic employees such as housekeepers, nannies, or gardeners.

Classes of business it applies to

This endorsement is specifically designed for individuals or families who own dwellings in California and employ domestic staff. It is commonly used in conjunction with dwelling fire policies, particularly for landlord-owned properties where the landlord directly employs staff for the maintenance or care of the residence.

• Real-world examples:
  • A landlord owning a rental property in California who directly employs a regular gardener or maintenance person for that specific property.
  • An individual with a dwelling policy for their non-owner-occupied property who hires a part-time cleaner.
  • A family that owns a secondary home in California covered by a dwelling policy and employs a caretaker for the premises.

Special considerations

• Legal Requirement in California: California law mandates workers' compensation coverage for most household employees, even part-time ones. This endorsement helps insureds comply with these state-specific legal obligations. Failure to carry this coverage when required can lead to significant penalties.
• Definition of "Employee": It is critical to correctly classify individuals as "employees" versus "independent contractors." This endorsement applies only to individuals deemed employees under California law. Misclassification can result in denial of coverage and legal repercussions for the employer.
• Scope of Coverage: This endorsement is not a standalone workers' compensation policy. It modifies the existing dwelling policy and is subject to its terms and conditions, in addition to the specifics of the endorsement itself.
• Mandatory Offering: In some dwelling insurance programs in California, this endorsement may be a mandatory part of the liability coverage package if residence employees are present.

Key information for agents and underwriters

• Risk Assessment: Underwriters must carefully evaluate the scope of domestic employment. This includes the number of employees, their specific duties (e.g., childcare, gardening, cleaning, cooking), and the total hours worked per week. Higher exposure (e.g., full-time staff, multiple employees, or higher-risk duties) will influence underwriting decisions and potentially pricing.
• Pricing: The premium for this endorsement is influenced by the payroll associated with the residence employees and the rates applicable in California for workers' compensation.
• Educating the Insured: Agents play a crucial role in informing California dwelling owners about their legal responsibilities to provide workers' compensation for their household staff. They should explain how this endorsement helps meet those requirements and the potential consequences of not having adequate coverage.
• Coverage Adequacy: For insureds with extensive household staff or whose employment arrangements are complex, agents and underwriters should consider if this endorsement provides sufficient coverage or if a separate, standalone workers' compensation policy might be more appropriate.
• Program Eligibility: Underwriters should ensure that the risk aligns with the specific dwelling program's guidelines. For instance, some programs are designed for landlords with a small number of rental properties and may not be suitable for properties with significant business activities beyond typical residential use.