1. Forms
2. HO
3. HO-06-51

What the form is

The HO 06 51, titled "Damage To Property Of Others – Increased Limits," is an endorsement to an ISO Homeowners Policy. Its primary function is to allow the policyholder to select a higher limit of liability for the "Damage to Property of Others" coverage, which is typically found under Section II – Additional Coverages of the homeowners policy. The standard limit for this coverage is often $1,000 per occurrence. This endorsement modifies that section to provide a greater amount of coverage as specified in the endorsement or on the policy Declarations page.

Classes of business it applies to

This endorsement is used in Personal Lines, specifically with Homeowners insurance policies. It can be attached to various ISO Homeowners forms, including:

• HO 00 02 (Broad Form)
• HO 00 03 (Special Form)
• HO 00 04 (Contents Broad Form)
• HO 00 05 (Comprehensive Form)
• HO 00 06 (Unit-Owners Form)
• HO 00 08 (Modified Coverage Form)

Real-world examples where this endorsement would be beneficial include:

• An insured accidentally damages a valuable item borrowed from a friend.
• An insured inadvertently causes damage to a hotel room or a vacation rental property while traveling.
• An insured participating in home-sharing as a traveler may wish to have higher limits for potential damage to the host's property.

Special considerations

The standard $1,000 limit for Damage to Property of Others coverage can be insufficient for many common scenarios. This endorsement provides a crucial option for insureds to obtain more adequate protection. It is an optional coverage that must be specifically added to the policy. The increased limit selected applies per occurrence. In the context of home-sharing, if an insured has a home-sharing host activities endorsement, the increased limits from HO 06 51 can also apply to damage to property of others arising from those activities.

Key information for agents and underwriters

For Agents:

• It's important to discuss the adequacy of the standard $1,000 limit with clients and offer this endorsement as a way to enhance their liability protection.
• Clients who travel frequently, often borrow items of value, or have children who might accidentally damage others' property could particularly benefit from higher limits.
• Explain that this coverage is for damage caused by an insured to property belonging to others, and it pays at replacement cost, subject to certain exclusions.

For Underwriters:

• The primary underwriting consideration is the limit selected by the insured. Available increased limits might include options such as $5,000, $10,000, $25,000, or $50,000.
• While the exposure for this coverage is generally within the normal scope of homeowners liability, unusually high limit requests might warrant further review of the insured's circumstances.
• The premium for this endorsement is typically a flat additional charge based on the increased limit chosen.
• Ensure the correct edition date of the form is used and that it is compatible with the base homeowners policy to which it is attached.