Bill Wilson’s article in the June 2014 issue of IA Magazine answered a ‘unique’ question.
Here’s the scenario: An insured buys a new riding mower to use at a residence he plans to purchase, but hasn’t closed on yet. The insured lets his son borrow it to mow his yard. The mower is stolen.
The man’s homeowners insurer has denied the claim, stating the mower is a motor vehicle and didn’t service the residence premises since the insured hadn’t used it at the home currently insured. The insurer claims there is no coverage until the insured actually uses the mower on the insured residence.
Do you agree with the insurer’s denial?
According to Wilson, the 2000 insurance homeowners policy said it covers motor vehicles not required to be registered for use on public roads or property which are used solely to service on the insured’s residence, or is designed to assist the handicapped.
That means the policy covers the mower only if it is always used to service the insured’s residence. Even if he had used it and then loaned it to his son, once the mower is used off his residence premises, it is no longer used solely to service his residence and his coverage vanishes forever.
Under the 2011 insurance form, the mower is covered as long as it is used to service “a” residence. So as long as it’s used only to service the insured’s residence or his son’s residence (or anyone else’s residence) as opposed to mowing the church lawn or the local football field, it’s covered.
If it’s the 1991 edition of the insurance policy, as long as it’s used at some point in time to service the insured’s residence, it’s covered for damage worldwide.
Another important consideration: had his son used the mower yet? If the son used it to mow his own lawn, I think your insured is out of luck with this edition of the policy. But if not, the mower should be covered worldwide as long as it has not been used anywhere other than your insured’s residence. If the mower had not been used at all, I think it would be a stretch for the insurer to claim that it has to be ‘used’ on the insured’s residence before coverage attaches. That would mean that any mower you buy has no coverage until you get it home and actually use it.
Based on that interpretation, if you get a bargain on a new mower in October and don’t use it until April, there is no coverage in the interim because it wasn’t yet ‘used solely to service’ a residence. That’s just silly and reminiscent of the homeowners ‘where you reside’ issue – if I close on a house but don’t move in until four days later, do I have no coverage it it’s destroyed by a tornado the day after closing simply because I have not yet resided there? A literal reading of the policy could argue yes, but the reasonable expectations of any insured would make such an interpretation ludicrous.
Check your homeowners policy to be sure you have the proper coverage on your home and property. If in doubt, contact your insurance agent or E. R. Munro and Company at 1-877-376-8676 for more information.
