Some homeowners insurance policies contain endorsements or specific language which provide coverage for specific structures located away from the Residence Premises. The recent case of Jacquart v. State Auto Property & Casualty Insurance Company,1 analyzed whether a structure located 119 miles from the Residence Premises was covered under such an endorsement.
The relevant policy language provided:
We cover each structure described in the Schedule above which is owed by you and located away from the ‘residence premises,’ if used by you in connection with the ‘residence premises.’
The insureds had purchased property located 119 miles from the Residence Premises and constructed a small structure on the land. While the structure had a roof, hardwood flooring, windows, a secure door, a wood-burning stove, and pre-wiring for electricity, it did not contain a bathroom or kitchen facilities, nor did it have sewer or running water. The structure was unfurnished.
The structure was damaged as a result of a wildfire and the insureds made a claim to State Auto. State Auto denied the claim on the basis that the structure was not used “in connection with the residence premises.” The insureds filed suit and State Auto moved for summary judgment on the same basis.
The United States District Court for the District of Colorado granted State Auto’s motion for summary judgment concluding that the tiny structure was not used in connection with the Residence Premises. First, the court rejected the insured’s argument that they used the structure as a means to “escape from the heat” of the Primary Residence. The court found that by its very nature using the structure as an “escape” could not be interpreted as using the property “in connection with” the residence premises. And second, the court rejected the insured’s argument that the property was used to store recreational equipment and unused carpeting, which could not be enjoyed at the Residence Premises.
The court noted that unlike a shed or garage where items are stored which can actually be used at the Residence Premises, such items could not and were not used in connection with the Residence Premises. In other words, using one item which was stored at the structure was not enough to conclude that the property itself was used in connection with the Residence Premises. The court concluded that the use of the structure was separate and distinct from their use of the Primary Residence and therefore coverage was not provided under the policy’s Structures Away endorsement.
1 Jacquart v. State Auto Prop. & Cas. Ins. Co., No. 19-cv-2480, 2020 WL 7055500 (D. Colo. Dec. 2, 2020).