1. Forms
2. HO
3. HO-06-65

What the Form Is

The HO 06 65, titled "Broadened Home-Sharing Host Activities Coverage Endorsement," is an optional endorsement designed to be added to the HO 00 05 Comprehensive Homeowners Policy. Its primary function is to modify the standard homeowners policy to provide specific insurance protection for policyholders who rent out their insured residence on a short-term basis through home-sharing platforms (e.g., Airbnb, VRBO, HomeAway). Standard homeowners policies often contain exclusions or limitations for "business activities" or for the rental of property, which can leave significant coverage gaps for home-sharing hosts. This endorsement aims to fill those gaps by broadening coverage for defined "home-sharing host activities." It notably stipulates that the coverage provided by this endorsement is primary over any insurance or guarantee offered by the home-sharing network platform itself.

Classes of Business It Applies To

This endorsement is specifically for residential properties insured under an HO 00 05 policy where the insured is participating in home-sharing. This includes:

• Homeowners who occasionally or regularly rent out a portion of their home (e.g., a room or a floor) to guests.
• Homeowners who rent out their entire primary residence to guests for short periods.
• Policyholders using third-party hosting platforms to facilitate these rentals.

Real-world example: A family insures their home with an HO 00 05 policy. They decide to rent out their entire home for two weeks while they are on vacation, using a popular home-sharing website to find renters. The HO 06 65 endorsement would provide them with broadened coverage for property damage or liability incidents that might occur during this rental period, subject to the terms and limits of the endorsement.

Special Considerations

• Attachment to Specific Policy: This endorsement is specifically designed for use with the HO 00 05 policy form. Other similar endorsements exist for different homeowners policy forms (e.g., HO 06 63 for HO 00 03).
• Primacy of Coverage: A key feature is that it makes the homeowners policy primary for eligible home-sharing host activities, meaning it pays before any coverage or protection plan offered by the home-sharing platform. The endorsement often classifies home-sharing agreements as guarantees or protection plans rather than insurance.
• Scheduled Limits: The endorsement includes a schedule for "Home-Sharing Host Activities Damage to Property of Others," allowing the insured to select a specific per-occurrence limit for this coverage, which may be higher than the base policy's limit for damage to property of others. If no increased limit is selected, a base limit (e.g., $1,000) may apply.
• Home-Sharing Verification: Insurers have a condition allowing them to inquire about the frequency and nature of the insured's home-sharing activities to properly underwrite and rate the exposure.
• ISO 2022 Program: While the ISO 2022 Homeowners Program incorporated some home-sharing considerations into the base policy forms, optional endorsements like the HO 06 65 continue to offer more specific or broadened coverage options.

Real-world example: If a guest accidentally causes a fire resulting in $5,000 of damage to a neighbor's fence during a home-sharing stay, and the insured has selected a $10,000 limit for "Home-Sharing Host Activities Damage to Property of Others" on the HO 06 65, this endorsement would respond, and the homeowners policy would be primary over any protection plan offered by the rental platform.

Key Information for Agents and Underwriters

• Risk Assessment: Underwriters need to thoroughly assess the home-sharing exposure. This includes the frequency of rentals, the portion of the home being rented, the maximum number of occupants, and any screening processes the insured uses for guests.
• Pricing: This endorsement requires an additional premium commensurate with the increased risk.
• Addressing Coverage Gaps: Agents should highlight how this endorsement closes potential coverage gaps that exist in an unendorsed HO 00 05 policy concerning business use or rental activities.
• Modifications to Base Policy: It's important to explain to the insured how this endorsement changes their existing coverage, particularly concerning Section I (Property) and Section II (Liability) conditions, and the specific coverage for damage to property of others. For instance, it replaces the base form's "Damage to Property of Others" coverage with "Home-Sharing Host Activities Damage to Property of Others" for incidents related to home-sharing.
• Exclusions and Limitations: While broadening coverage, the endorsement will still have its own definitions, exclusions, and limitations that need to be understood. For example, it may exclude coverage for theft or vandalism by a home-sharing occupant unless specifically bought back or included.
• State Variations: While ISO develops these forms for multi-state use, adoption and specific edition dates can vary by state. Agents must ensure they are using the correct, state-approved version.