Analysis brought to you by the experts at FC&S Online, the recognized authority on insurance coverage interpretation and analysis for the P&C industry. To find out more — or to have YOUR coverage question answered — visit the National Underwriter website, or contact the editors via Twitter: @FCSbulletins. Question: In regard to the HO 00 03 05 11 Homeowners 3 — Special Form... If the insured/homeowner rents a room plus access to use of the balance of the house such as the kitchen, bathrooms and all common areas of the house to a non-relative tenant, does the exception for personal property theft apply? And, does it exclude any and all property of the insured/homeowner's because the renter has use of the entire common area of the house as part of their monthly rental fee? This exception reads: "This peril does not include loss caused by theft... From that part of a 'residence premises' rented by an 'insured' to someone other than another 'insured.'" So, if an unknown thief breaks into the house and steals the insured/homeowner's TV from a common area, does this exception to coverage apply because this common area is rented to someone other than an "insured"?

— Michigan Subscriber

Answer: I can find no cases relevant to this situation. While the tenant has access to the whole house, he is really paying for access to the room to sleep in and to store his belongings. Having access to and renting are two different things; the intent is to exclude items in the space the tenant is renting, the room, and not the rest of the insured's belongings. Seeing that it could be read the other way, that property in any area the tenant has access to is excluded for loss by theft, the language is ambiguous and the insured should get the benefit of the doubt. The theft of the TV should be covered.

Neighbors with sticky fingers

Question: We have a homeowner's HO-03 policy. We have a four-car garage on our property and rent part of it out to our neighbor for a fee of $250 per month. The neighbor renting the space is now claiming that a generator they were storing in the space was stolen. No proof the generator was ever in the unit. We are thinking there would not be coverage for this, given the policy exemption for the property of roomers, boarders and other tenants, except property of roomers and boarders related to an "insured." Is this correct?

— Massachusetts Subscriber

Answer: You are correct, the loss is excluded not only under property of tenants, but also under theft; property stolen from that part of a residence premises rented to someone other than an other insured is excluded. Damage to Common Areas under a Tenant Homeowners? Question: Our insured rents one of three units in a landlord-occupied dwelling, and has an AAIS tenant homeowners' policy. While playing, her children (all of whom are under 10) damaged walk lights that the landlord had placed adjacent to the walk leading to the dwelling. When we submitted the claim to the company, the claim was denied based on the following policy wording under damage to property of others: "We do not pay for damage to property owned by, rented to or leased to any insured..." The following exclusion under the liability section was also cited: "this coverage does not apply to liability...for damage to property rented to, occupied by, used by or in the care of an insured." We see the lights as common property for all residents and not specifically rented to the insured, and therefore think there is coverage for this loss. May we have your opinion?

— New York Subscriber

Answer: When a landlord rents an apartment to someone, that landlord is renting a particular space, such as an apartment, not the common areas. As such, the lights in question were not "rented" to the insured. The AAIS policy gives credence to this position when it defines an 'insured premises' as, "the parts of the described location which are used or occupied exclusively by your household for residential purposes." 'Insured premises' also includes, for liability purposes, "approaches and access ways immediately adjoining the insured premises." Should someone trip and fall immediately outside the insured's door, and the insured is found to be negligent, the liability portion of the policy would respond. The AAIS policy contains an additional coverage that ISO's homeowners' policies do not, "contracts and agreements." If the insured signed a lease on the apartment, and if that lease holds her responsible for damage to the common areas, then the AAIS policy would pay for the damage under that coverage. Also, that coverage does not contain the $500 limit as does "damage to property of others." It is conceivable that the insurer might be "on the hook" for much more than $500. Finally, since the lights cannot be considered to be "rented to the insured," we believe that the entire limit of the policy language in question should be available to pay the claim. The policy should respond with its entire limit. See also: Who pays when tenant improvements are damaged Understanding debris removal coverage, costs and settlements How is insurance coverage impacted by a property lien