I own one piece of property in Florida which is my legal address and is homesteaded for property tax purposes. This condo is the only residence I own. I also own an RV which I travel around the country in full time (ie - I never spend any time at my permanent residence). Anyway, a friend of my son’s was looking to go to school and live in my condo. I agreed to let them live there with their sibling and they are paying me a below market rate to stay there while they go to school. They are also paying utilities. In return, they are checking our mail and keeping an eye on the place. I have no lease, no term, no deposits and no recourse if they decide they no longer want to pay. My primary concern is someone falls down the stairs or otherwise injures themselves while they are living there. I want to be fully covered for any liability if someone is injured. I figure I need a regular condo policy for this situation (the HOA has a master policy for the outside of the building) but I wanted to confirm if anyone else has dealt with this type of situation. I can’t get a straight answer from any agents because the determination to accept or deny a claim lies with the underwriter and no one I have spoken with has dealt with this situation before. If there is a claim that needs to be filed, I will not have been there during the incident that gave rise to the claim and the injured person would be someone who pays me some money to stay there while looking after the place. It sounds like a reason to deny a claim but it seems like I should be able to own a place and have someone stay there to look after it, even if they are paying something to be there. When the place was vacant, the AC drain overflowed and leaked onto the ceiling which gave rise to me wanting to have someone there and accepting my son's friend to stay there. Does anyone have any thoughts on how to handle insuring this? Much appreciated.
Full time RVer never home with friends living at permanent residence
- Thread starter Dave1
- Start date
- 2,195
What does the occupancy say on the Unit Owners Condo Policy?
- Thread starter
- #3
No idea. I just bought it a few days ago and as far as I know, you cannot read it until they send it to you.
- Thread starter
- #4
This comment got me thinking about it and realized I do have online access (doh!). There isn't anything explicit in the policy about my occupancy of the unit being necessary for some period of the year as far as I can tell within the 33 pages of the policy. The closest thing I can find is the definition of "residence premises" which is defined as "the unit where you reside shown as the residence premises in the declarations." Do I reside there if the property is homesteaded and I pay the property taxes, I've owned it for years, my auto insurance address is there, my voter registration is there, my driver license has that address, I file my taxes at that address, all of the furniture, beds, electronics, are mine, etc. It's the only real estate I own and everyone needs a place to live, right? I just don't spend any time there. If they denied a claim based on my non-residence wouldn't the insurance company need to prove that I live somewhere else and provide an address for where they think I really live?
As far as liability, which is my primary concern, the policy reads, "If a claim is made or suit is brought against an insured for damages because of bodily injury or property damage caused by an occurrence for which this coverage applies we will pay up to our coverage limits and hire an attorney to defend you." (paraphrased) That is exactly what I am looking for. According to the definition page the "insured" are "You and residents of your household who are your relatives", which obviously my son's friends are not relatives. I don't want coverage for them necessarily. I want it in case some sort of bodily injury happens to one of them and their parents decide to sue me. Based on this wording, I think it may be covered (now I sound like the hesitant insurance agents I spoke with lol). Also, in one place reference is made to compensation if part of the residence "rented to others" or "held for rental to others" (other than home-sharing/hosting activities based on a web platform which they clearly do not cover) becomes not fit to live in they cover the fair rental value of such premises less any expenses that do not continue while it is unfit to live in. This suggests that they understand I may have renters and covers them, at least in the context of the property becoming uninhabitable. I wish they had such strong and clear wording with respect to any bodily injury liability suit I may encounter, along with what constitutes "residing" at that address.
I guess what I am looking for is general confirmation from people on this forum who know about these things that it is reasonable to expect that this condo policy would cover any liability I may incur from people staying at my house while paying me something to be there. I guess it is a gray area as far as whether or not my traveling would negate me being from being considered 'residing there' that I may have to fight them on if anything happened and a claim was denied on that basis. It is a Florida "UPCIC HO6" policy if that helps.
- 2,195
Virtually every homeowners/dwelling/condo application I have processed requests information on who the residents are. How did you answer this question?
Additionally - what does your Florida Insurance Agent tell you?
That sure sounds like it is occupied by a Tenant.
This sure does not sounds like an owner occupied dwelling to me. [Unless there is some other family member involved here]
@adjusterjack ?
- Thread starter
- #6
Thank you for the response.
They were only concerned about who owned the place, which is my wife and me. I have heard different things from different agents. The one I have now who signed me up with the only one who accepted me (the Florida insurance market is horrible right now due to hurricanes and excessive legal issues by roofing contractors) doesn't think it will be a problem but I sensed he was hungry for a commission. Another agent I spoke with said according to Citizens' insurance (Florida's insurer of last resort) they would classify my place as a rental, so the homestead needs to be removed and a landlord policy be purchased for Citizens to write it. I guess the landlord insurance is actually cheaper than the the condo insurance I have purchased but that isn't what I want as I own everything inside. Also, the landlord policy would require me to give up my homestead, which is something I don't want to do as I want to have an address for mail, driver license, auto insurance, etc and the property tax portability should I ever stop traveling. Simply put, I view the place as my house.
There is nothing I can find in the policy about being owner occupied other than what I wrote above about 'residing' there.
If the insurance won't cover me, the alternative for me is to kick the friends out. As an insurer, I would think it would be far riskier for me to have no one in there with respect to theft, a leaky roof or water heater that goes unnoticed for months or longer or a refrigerator compressor overheating and catching fire. I mentioned the AC in the OP and that went unnoticed for months and made a mess of the ceiling which won't happen now with someone living there.
I just don't know until something happens, which hopefully never would. The part I am most concerned about is liability, which costs a whopping $16 for a policy that in total costs north of $1k for everything else.
- 2,195
I am not a Florida Agent. But this situation makes me uncomfortable.
"Most homeowners policies, including the “ISO standard” HO-3 examined in this paper, cover damage to the dwelling on the “residence premises” shown in the policy declarations. The term “residence premises” is defined to include the dwelling “where you reside.” According to some interpretations and court decisions, if the named insured and/or resident spouse no longer reside in the dwelling, coverage on that structure immediately terminates. If this school of thought is correct, this gives rise to a number of circumstances that may lead to a catastrophic coverage gap for such insureds..."
You do not have an HO3, likely and HO6 [not your agent so i do not know] but still...
Source - Where you Reside
Dont even get me started on the premises liability issue here.
"Most homeowners policies, including the “ISO standard” HO-3 examined in this paper, cover damage to the dwelling on the “residence premises” shown in the policy declarations. The term “residence premises” is defined to include the dwelling “where you reside.” According to some interpretations and court decisions, if the named insured and/or resident spouse no longer reside in the dwelling, coverage on that structure immediately terminates. If this school of thought is correct, this gives rise to a number of circumstances that may lead to a catastrophic coverage gap for such insureds..."
You do not have an HO3, likely and HO6 [not your agent so i do not know] but still...
Source - Where you Reside
Dont even get me started on the premises liability issue here.
- 2,263
You need a landlord policy or a condo owner policy marked as a rental unit. Your tenant needs a rental policy. You also need to make sure that your policy is endorsed to cover as much of the condo assoc. deductible as possible.
NormMitchell
Expert
- 43
I agree with fed up; you need a landlord or condominium policy noted as a rental unit. Also, when dealing with an agent, you need to memorialize any conversations with an email (restate the conversation between you and the agent in an email, ask questions that require an answer). This way, you have the agent's E&O coverage to fall back on if they have given you bad advice. The risk is that it is being insured as if you are the owner living there, but that is not the case; it is a rental unit rented to someone who is not related to you.
- 2,195
Agreed
However then the challenge becomes - where does he pick up Personal Liability coverage for himself and his family.
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