Items in storage units may not be covered by a HO policy

September 7, 2022

So, it used to be that if clients asked you if their homeowners insurance policy covered their property anywhere in the world, you could reply: “Yes. However, if they are in another one of your residences, then coverage is limited to 10% of the limit shown in your primary homeowners policy.” Then, you would ask them which property they were discussing, so you could make sure it wasn’t listed in the homeowners insurance policy’s exclusions or limitations, and needed an umbrella policy.

Now you need to ask an additional question: “Is your property stored in a self-storage facility?”

According to the 5/11 edition of homeowners (HO3) form, there is a paragraph that addresses limitations for “self-storage facilities” for new homeowners insurance policies. This change only provides 10% of the personal property limit for items in self-storage facilities—before the change, the 10% limitation was only on items stored at a secondary residence. Since people don’t live in storage units, this limitation did not apply.

The 5/11 edition of homeowners (HO3) form, reads as follows:

2. Limit For Property At Other Locations

a. Other Residences

Our limit of liability for personal property usually located at an “insured’s” residence, other than the “residence premises”, is 10% of the limit of liability for Coverage C, or $1,000, whichever is greater. However, this limitation does not apply to personal property:

(1) Moved from the “residence premises” because it is:

(a) Being repaired, renovated or rebuilt; and

(b) Not fit to live in or store property in; or

(2) In a newly acquired principal residence for 30 days from the time you begin to move the property there.

b. Self-storage Facilities

Our limit of liability for personal property owned or used by an “insured” and located in a self-storage facility is 10% of the limit of liability for Coverage C, or $1,000, whichever is greater. However, this limitation does not apply to personal property:

(1) Moved from the “residence premises” because it is:

(a) Being repaired, renovated or rebuilt; and

(b) Not fit to live in or store property in; or

(2) Usually located in an “insured’s” residence, other than the “residence premises”.

As noted in the language of the form, there is an exception to this 10% limitation. If the property has been removed to a self-storage facility because the insured premise is being repaired or renovated because it is unfit to be lived in at the time, then there should be full coverage.

So, when advising your clients, you should ask them if they have property in self-storage units. Find out what type of things they are storing in them. And, advise them about insurance coverages that will protect their property.

About the author…

James Berliner

James Berliner, CPCU, of Newtown, Conn., is president of Berliner-Gelfand & Co. Inc., located in Bridgeport, Conn., and past president of PIACT. In industry affairs, Berliner served as a member of the General Accident Agency Advisory Council and the Safeco Agents Council. Active in his community, Berliner is a member of the Newtown Lions Club and has coached youth baseball. He also served on the House Committee for the United Jewish Center in Danbury, Conn.

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