Homeowners Will Be Able to Buy Broad Coverage For Home Business
NEW YORK, Dec. 17, 1996 — People who run small businesses out of their homes will soon be able to buy stepped-up insurance coverage.
Insurance Services Office Inc., (ISO) has filed a new home business insurance coverage endorsement — HOBIZ™ — for its homeowners program. HOBIZ covers most property and liability exposures for home-based businesses with up to three employees and gross annual revenues of up to $250,000.
The new endorsement builds on the limited home-business coverage provided in the basic homeowners, tenants, condo and co-op policies. Until now, individuals had to buy a businessowners policy to get broad property and liability coverage for their home businesses.
HOBIZ is designed to cover office, service, sales and crafts businesses on the premises that are used primarily for residential purposes. Businesses that involve food or the manufacture, sale and distribution of personal care products — except those manufactured by a nationally known company— are not eligible for this coverage.
HOBIZ offers the homeowner protection from the same perils covered by the policy to which the endorsement is added.
New features offered by the endorsement include:
- Payment of up to $5,000 for on-premises loss of accounts receivable and up to $2,500 for an off-premises loss.
- Payment of up to $2,500 for loss of manuscripts, records and other documents that have not been duplicated.
- Loss of business income for up to 12 months because of a business suspension caused by an insured peril.
- Payment for up to 12 months for the additional expense a business incurs because of damage to the home.
- Payment for the loss of business income for up to three weeks after a civil authority bans access to the place of business because of nearby damage caused by an insured peril.
- Personal liability coverage for advertising injury, personal injury and ongoing operations and products/completed operations exposures that arise from operating the home business up to the aggregate limits provided by the endorsement.
To better serve the needs of home-based small businesses, the new endorsement also expands some of the basic coverages offered in the homeowners program.
- The limit of coverage for money loss is increased from $200 to $1,000.
- Instead of a $2,500 on-premises limit and a $250 off-premises limit, the full personal property limits of the policy apply to business property covered under the endorsement.
- Personal property coverage is extended to include property of others placed in the insured's care for business reasons. Also included is property leased by the insured if there is a contractual requirement to insure the property.
- Coverage for trees, shrubs, and other plants is extended to trees, shrubs, plants and lawns grown for purposes of the business.
- The limit for credit card coverage is increased from $500 to $1,000 and is extended to apply to the business' credit cards and fund transfer cards.
ISO plans to make HOBIZ available for insurer use in May 1997.
Giuseppe Barone / Erica Helton
MWW Group (for ISO)
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