The “where you reside” language in the homeowners forms that the Insurance Services Office (ISO) has published since 1991 have spawned litigation around the country for over 20 years, given the number of scenarios which could see the named insured either temporarily or permanently not “in residence” at the property covered by his or her homeowners carrier. In an effort to remedy that, ISO has now released new forms that revise the definition of a “residence premises;” they had an effective date of October 1st in most states.
The problematic portion of the old forms was the three-word phrase “where you reside.” The homeowners insuring agreement in the existing ISO program recited that coverage was afforded for “the dwelling on the ‘residence premises’ shown in the Declarations[.]” “Residence premises” was then defined as follows:
“Residence premises” means:
- The one-family dwelling where you reside;
- The two-, three-, or four-family dwelling where you reside in at least one of the family units; or
- That part of any other building where you reside; and which is shown as the “residence premises” in the Declarations.
It thereby imposed two conditions for coverage; the insured structure had to be described on the declarations page and it had to be the building where the named insured (“you”) resided.For over two decades, “where you reside” has been the source of litigation in virtually every state. Courts have been asked to construe the phrase after insurers elected to deny coverage because:
- the insured was living in a nursing home and would not be returning to the dwelling;
- the insured had purchased and moved to a new home but still owned the old one, either because it hadn’t sold or because the new occupant(s) hadn’t moved in yet;
- the insured was in the process of remodeling or renovating the home but had yet to move in;
- the insured had purchased the structure but was still in the process of relocating from another state;
- the insured’s child or relative – but not the insured – resided in the home;
- the insured was recently deceased; or
- a divorce left the ex-spouse — who was no longer married to the named insured and therefore no longer an owner – in the home.
The result has been a conflicting and inconsistent body of jurisprudence. As an appellate court in Louisiana once observed, the term “resident” is “flexible, elastic, slippery, and somewhat ambiguous,” “nebulous in meaning,” “difficult of exact or satisfactory interpretation,” and “flexible and somewhat obscure.” Vinet v. Hano, 281 So.2d 183, 186 (La. App., Jul. 17, 1973).
The new forms were written with the foregoing in mind. They consist of three new mandatory endorsements (for single family homes, unit-owners, and those in mobilehomes) and a matching set of three optional “broadening” endorsements. The former track the language quoted above but add this formulation to the end of the definition of what constitutes a “residence premises:”
on the inception date of the policy period shown in the Declarations and which is shown as the “residence premises” in the Declarations.
The result is that the named insured(s) need only be living at the property when coverage begins to qualify it as a bona fide “residence premises.”
The latter were added because the phrase above still leaves some homeowners – such as the couple who are remodeling but have yet to occupy – out in the cold. The “broadening” endorsements allow the policyholder(s) and the carrier to designate a starting date and termination date during which the residency requirement will be removed from the definition of what constitutes a “residence premises.”