When the In-Laws Move In: Are They Covered?

As the Baby Boomer generation continues to grow older, it’s not uncommon to see aging parents move in with their grown children. Regardless of the reason, this situation is becoming more widespread and could potentially create insurance ramifications.  In fact, my mother-in-law just moved into our home and the insurance agent in me needed to make sure insurance coverage gaps did not exist!

Let’s look at the language in the standard HO 00 03 homeowners form.  The policy defines “insured” to include you and residents of your household who are your relatives. This definition will be helpful as we look to make sure proper coverage exists.

Next, we’ll look at how the policy addresses contents within the home. The form states that “we cover personal property owned or used by an “insured” while it is anywhere in the world.” Since a parent who moves in with us is considered an “insured,” his or her contents will also be covered by the homeowner policy. Therefore, we’re good to go from a property standpoint.

Let’s move onto the personal liability portion of the policy. Provided a claim is made or suit is brought against an “insured” for damages because of bodily injury or property damage caused by an “occurrence” as defined in the policy, the policy will pay up to the limit of liability for which an “insured” is legally liable. For example, if my mother-in-law takes my children out for ice cream and accidentally trips someone, she would be covered for the resulting bodily injury and/or property damage. Other bodily injury or property damage claims against her may also be covered provided the situation results from an “occurrence” that isn’t excluded (such as the use of motor vehicles, aircraft, watercraft, etc.).

Keep in mind that the policy excludes bodily injury to you or an “insured” as defined in the policy, so if your parent moves in and accidentally injures one of your children while playing with them in the backyard, the policy won’t provide any liability coverage.

I can now rest assured knowing that my mother-in-law’s contents and personal liability are both covered under my homeowner policy!  Now everyone can insert their own mother-in-law jokes here about other situations that might not be as easy to figure out…

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