Resident Relative and Separate Policies

May 3, 2016

The insureds are a mother and daughter who reside together. The mother has an HO-3 policy (HO 00 03 08 96, Homeowners 3 Special Form – Washington). The daughter has now purchased an HO-4 (HO 00 04 07 10, Homeowners 4 Contents Broad Form – Washington). As the daughter is an insured under her mother's HO-3 policy, what benefit will she and/or her mother get by the daughter purchasing her own HO-4 policy? Or is the HO-4 not necessary?

Policy Coverages:

HO-4 HO-3

A: N/A $399,000

B:N/A 39,900

C: $26,000 299,300

D: 7,800 119,700

E: 100,000 300,000

F: 1,000 1,000

Deductible

1,000 250

No endorsements

Washington Subscriber

The daughter is a resident relative, and as such is covered by the HO 3. A home inventory of personal property for both is advised to be sure all the property is covered. The mom might need to increase coverage C. If the arrangement is permanent or long term, the daughter should be fine under the HO 03—as a resident relative she is an insured. However, if the arrangement is short term then she might want to keep the HO 04 so she has it when she moves. It really depends on the situation. They should do the home inventories; most people underestimate the value and how much stuff they actually have, and there are many home inventories available online and even free apps.

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