11.2 Section I Property Coverages A–D

11.2 Section I Property Coverages A–D

Quick Answer: ISO homeowners Section I is four property coverages. Coverage A — Dwelling is the residence building and attached structures. Coverage B — Other Structures is detached structures, typically 10% of A. Coverage C — Personal Property is unscheduled contents, typically 50% of A on owner forms, worldwide, subject to special limits (money; theft of jewelry, firearms, and silverware; business property). Coverage D — Loss of Use is additional living expense (ALE) and fair rental value (FRV) after a covered loss makes the residence uninhabitable. Additional coverages sit beside A–D. Animals, motor vehicles, aircraft, and property of roomers are property not covered.

Walk Section I in order. A tree that crushes a backyard shed is Coverage B, not A and not C. A stolen suitcase in a hotel is Coverage C, not a dwelling claim. A hotel bill after a kitchen fire is Coverage D, not “the value of the house.” AINS items fail people who treat “homeowners” as one undifferentiated pile of money.

Limits below are the usual unendorsed ISO relationships on an owner form such as HO-3. They are percentages of Coverage A unless the declarations state a different amount. HO-4 has no Coverage A, so contents and loss of use are stated dollar limits. HO-6 Coverage A is a stated limit for unit-owner building items, not a percentage of a high-rise shell.

Coverage A — Dwelling

Coverage A insures the dwelling on the residence premises used principally as a private residence, including structures attached to the dwelling (an attached garage, a deck that is part of the house). It also insures materials and supplies located on or next to the residence premises that are being used to construct, alter, or repair the dwelling or other structures.

Coverage A does not insure land, including land on which the dwelling is located. A mudslide that strips the lot is not a Coverage A land claim. Excavation that is part of repairing a covered dwelling may still be part of the building loss; the dirt itself is not the insured property.

On HO-4 there is no Coverage A for the landlord’s building. On HO-6, Coverage A is the unit owner’s building items and improvements—not the association’s common walls unless the association agreement shifts that duty to the unit owner.

Coverage B — Other Structures

Coverage B insures structures on the residence premises set apart from the dwelling by clear space. A fence, detached garage, shed, gazebo, or guest cottage connected only by a fence or utility line is other structures. The typical unendorsed limit is 10% of Coverage A, and on standard ISO owner forms that amount is additional insurance, not a sublimit that reduces Coverage A.

Coverage B is where CSRs mis-file backyard losses. A tree through the house is A. A tree through the detached garage is B. A riding mower inside the detached garage is C.

Structures used for business, or rented to anyone who is not a tenant of the dwelling (other than a private garage), are generally not covered under B. A detached studio used as a paid workshop can be a Coverage B problem even though it sits on the same lot. A private garage rented solely as a garage is the usual exception.

Coverage C — Personal Property

Coverage C insures personal property owned or used by an insured while it is anywhere in the world. Furniture, clothing, electronics, and kitchenware at home, in a storage unit, or in a hotel room are the same coverage part. The typical unendorsed limit on HO-2/3/5/8 is 50% of Coverage A, additional insurance. HO-4 and HO-6 use a stated Coverage C limit the insured chooses.

At other residences an insured owns or uses (a vacation cabin the family occupies, a child’s furniture at college housing that is not a dorm exception), Coverage C is often limited to 10% of C or $1,000, whichever is greater, unless the other residence is a newly acquired principal residence (a short automatic period, commonly 30 days). Worldwide does not mean “full contents limit at every second home.”

Property of others on the residence premises, and property of guests or residence employees, may be covered if the named insured asks. Property of roomers, boarders, and other tenants who are not related to an insured is not covered—an exam favorite when a tenant’s television is stolen from a rented bedroom.

Special limits: categories first, dollars second

Coverage C is unscheduled personal property with special limits that cap certain categories. Jewelry, cash, and business property are why producers schedule items or add a business-property increase. If you cite a dollar figure, treat it as a common ISO special-limit amount on a widely used HO-3 edition; editions and state filings change the number, but the categories are stable.

Two rules save items. First, theft-only special limits (jewelry, firearms, silverware) do not reduce a fire or other non-theft loss to those items; the ordinary Coverage C grant applies, subject to ACV or a replacement-cost endorsement. Second, scheduling a ring on a personal-articles endorsement takes that item out of the unscheduled theft cap and usually provides open-perils, agreed-amount treatment for that article.

Coverage D — Loss of Use

Coverage D is the household net-income coverage from Assignment 1, now as a form grant. When a covered Section I loss makes the residence premises uninhabitable, the policy pays:

• Additional living expense — the extra cost of maintaining a normal standard of living: hotel or short-term rental, extra meals above the usual grocery spend, extra commuting, storage. It is not the family’s entire living budget and not the rebuild cost of the house.
• Fair rental value — rent the named insured would have received from that part of the residence rented to others, minus discontinued expenses, if a covered loss makes that part uninhabitable.
• Civil authority — typically a short period (often two weeks) when a civil authority prohibits use because a neighboring premises was damaged by a cause of loss that would have been covered at the insured location.

On owner forms Coverage D is typically a percentage of Coverage A (commonly 30% of A on ISO HO-3). On HO-4 it is typically a percentage of Coverage C. Loss of use requires a covered cause of loss. A flood that makes the house uninhabitable does not unlock ALE on an unendorsed HO-3; the water exclusion still governs.

Additional coverages

Section I additional coverages are not a fifth lettered coverage; they are specified extras. Common ISO items, with amounts labeled as common ISO additional-coverage figures that vary by edition:

• Debris removal — cost to remove debris of covered property after a covered loss; an extra percentage (often 5% of the applicable limit) may apply if debris plus the loss exhausts the limit. Fallen-tree removal has a small aggregate when a tree damages covered property or blocks a driveway.
• Reasonable repairs — temporary protection (tarp, board-up) after a covered loss, so the insured does not fail the duty to protect property.
• Trees, shrubs, and other plants — typically a percentage of A with a per-plant cap (commonly 5% of A, $500 per plant), named perils, and windstorm often excluded for the plants themselves.
• Fire department service charge — commonly $500, often with no deductible.
• Property removed — covered property moved from a premises endangered by a covered peril, for a short period (commonly 30 days).
• Credit card, electronic fund transfer card, forgery, and counterfeit money — commonly $500.
• Loss assessment — a small limit (commonly $1,000) for certain association assessments from a covered cause.
• Collapse — collapse from specified causes (hidden decay, hidden insect damage, weight of contents or rain, defective construction during construction), not “the house sagged because it is old.”
• Glass or safety glazing — breakage of covered glass.
• Landlord’s furnishings (HO-3) — appliances, carpeting, and household furnishings in an apartment on the residence premises regularly rented to others; commonly $2,500, usually on a named-perils basis.
• Ordinance or law — increased cost to rebuild to code after a covered loss; later ISO HO-3 editions commonly give 10% of Coverage A as additional coverage. That slice is often too small for a full code upgrade; an endorsement increases it. Ordinance or law remains a Section I exclusion except to the extent of this additional coverage.
• Grave markers — a modest limit (commonly $5,000) for grave markers on or away from the residence premises.

Property not covered

The contents grant is broad, then the form carves out property that belongs on another policy or is uninsurable here:

• Animals, birds, or fish (the dog is not personal property under Coverage C).
• Motor vehicles, including their equipment and electronics, with narrow exceptions for vehicles not required to be registered that are used to service the premises or designed to assist the handicapped.
• Aircraft and parts, other than hobby aircraft not designed to carry people or cargo.
• Hovercraft.
• Property of roomers, boarders, and other tenants who are not related to an insured.
• Property in an apartment regularly rented or held for rental to others, except landlord’s furnishings as additional coverage.
• Property rented or held for rental to others off the residence premises.
• Business data (the paper or program, not the blank media).
• Credit cards and fund-transfer cards except as the additional coverage provides.
• Water or steam (the water in the pipes is not contents).

A stolen family car is a personal auto physical-damage claim, not Coverage C. A stolen laptop used primarily for a side business still has to clear the business-property special limit. A tenant’s bicycle in a rented bedroom is not the landlord’s Coverage C. Those three facts patterns are Assignment 3, not trivia.