What it does
The homeowners forms cap property used primarily for "business" purposes (in the 05 11 edition, $2,500 on the residence premises and $1,500 away). HO 04 12 increases the on-premises limit for a premium.
Who needs it
Insureds who keep laptops, tools, samples or equipment for their work at home but whose business activity is otherwise covered elsewhere or excluded.
Key provisions and limits
- Insurers typically allow increases in $2,500 increments up to a stated maximum and exclude property held as samples or for sale, and property of a business actually conducted on the premises.
- It increases property limits only; it does not add business liability.
Quoting and selling notes
- If the client conducts business at home, the increased limit may not apply; use HO 04 42 or HO 07 01 instead.
- Contractors' tools and equipment are better placed on an inland marine contractors equipment form.
Editions and availability
Editions in use and where they apply: 03 22 (41 jurisdictions); 05 11 (11 jurisdictions: AL, CA, CT, FL, GA, HI, LA, NC, TX, VI, WA); 10 00 (1 jurisdiction: PR).
Section II changes affect umbrella placement. The ISO personal umbrella (DL 98 01) needs its own excess endorsements for business pursuits, home business, home day care and home-sharing exposures, so confirm the umbrella responds before relying on a homeowners endorsement for a business-type exposure.
