What it does
Removes the business exclusions for a described incidental occupancy (such as an office, studio or small private school) on the residence premises. It can cover an other structure used for the occupancy and extends Section II liability to the described activity, so client and student visits are not excluded as "business".
Who needs it
Insureds who see clients, students or customers at home: accountants, tutors, music teachers, photographers, consultants. Typical underwriting rules permit the occupancy only if the home is occupied principally as a dwelling and no other business is conducted there, and require an increased Coverage C limit and a liability charge.
Key provisions and limits
- The occupancy must be described in the schedule; activities not described remain excluded.
- Do not rely on it for professional liability, employee injury or business auto exposures; those need separate policies.
- Some carriers automatically attach a computer-related damage exclusion (HO 04 13 / HO 07 58) with it.
Quoting and selling notes
- For a home business with inventory, products, more than incidental visitors or employees, look at HO 07 01 or a businessowners policy.
- For the same occupancy at another residence use HO 24 43; for home day care use HO 04 97.
Editions and availability
Editions in use and where they apply: 03 22 (40 jurisdictions); 10 00 (11 jurisdictions: AL, CA, CT, FL, GA, HI, LA, NC, PR, TX, VI).
Section II changes affect umbrella placement. The ISO personal umbrella (DL 98 01) needs its own excess endorsements for business pursuits, home business, home day care and home-sharing exposures, so confirm the umbrella responds before relying on a homeowners endorsement for a business-type exposure.
