1. Forms
2. HO
3. HO-24-03

What the form is

The HO 24 03, titled "Non-Owned Motorized Bicycle And Motorized Scooter Liability Exclusion," is an endorsement to a standard Homeowners (HO) insurance policy. Its primary function is to remove or exclude liability coverage for bodily injury or property damage that occurs when an insured is using a motorized bicycle or motorized scooter that they do not own, such as one they have rented or borrowed. This endorsement was introduced by ISO as part of the 2022 multistate homeowners filing to address the increasing use and associated liability exposures of these types of vehicles.

Classes of business it applies to

This endorsement applies to Personal Lines, specifically Homeowners insurance policies (e.g., HO 00 03, HO 00 04, HO 00 06, etc.). It is relevant for any policyholder who might rent or borrow motorized bicycles or scooters.

Real-world examples:

• An insured rents an electric scooter while on vacation and is involved in an accident causing injury to a pedestrian. Without this endorsement, there might be ambiguity or unintended coverage under the homeowners policy; with this endorsement, liability coverage for this incident would typically be excluded.
• An insured borrows a friend's motorized bicycle and accidentally damages someone's property while riding it. This endorsement would clarify that the homeowners policy does not provide liability coverage for this damage.

Special considerations

• Purpose of Exclusion: Insurers use this endorsement to manage and limit their exposure to the relatively new and evolving risks associated with non-owned micro-mobility devices.
• Distinction from HO 24 04: It's important to distinguish HO 24 03 from the HO 24 04 (Motorized Bicycle and Motorized Scooter Liability Exclusion). The HO 24 03 specifically addresses non-owned vehicles, while the HO 24 04 typically provides a broader exclusion for both owned and non-owned motorized bicycles and scooters.
• Coverage for Other Non-Owned Vehicles: The endorsement clarifies that liability protection may still be in force for other types of non-owned and owned vehicles (e.g., toy vehicles for children) subject to specific low speed and use requirements as defined in the main policy.
• Interaction with HO 24 13: The HO 24 13 (Incidental Low Power Recreational Motor Vehicle Liability Coverage) is an endorsement that can provide some coverage for certain owned and non-owned low power recreational motor vehicles, including some motorized bicycles and scooters. The HO 24 03 acts to specifically carve out non-owned motorized bicycles and scooters from such potential coverage if an insurer chooses to do so.

Key information for agents and underwriters

• Risk Assessment: Underwriters can use this endorsement as a tool to control adverse selection and manage exposures related to the use of rented or shared motorized scooters and bicycles, which can vary significantly in terms of user experience, safety regulations, and potential for claims.
• Pricing: While this is an exclusion endorsement and typically wouldn't add premium, its presence or absence can be a factor in overall risk assessment and pricing strategy for a book of business.
• Coverage Gaps: Agents should be aware that adding this endorsement creates a specific coverage gap for liability arising from non-owned motorized bicycles and scooters. It's crucial to explain this exclusion to insureds, especially those who frequently use such rental services, so they understand their personal liability exposure and can seek alternative coverage if needed (e.g., through the rental company, if available, or a personal umbrella policy, though umbrella policies may also have similar exclusions).
• Clarity of Coverage: This endorsement helps to clarify the insurer's intent regarding these specific types of vehicles, reducing ambiguity that might otherwise lead to disputes or unexpected claim payouts.
• State Variations: While this is a multistate form, agents and underwriters should always verify if any state-specific rules or endorsements modify its application.