Business Pursuits Exclusion in California

California law defines a business pursuit "as a regular activity engaged in for the purpose of earning a profit." Smyth v. USAA Property and Casualty Insurance Co., 152 Cal. App. 3d 864, 869 (1984). CMLP has identified no California cases interpreting this test in the context of online publishing out of the home (or elsewhere). As a general matter, however, California cases have established that an activity need not be full-time or a primary (or even major) source of income in order to qualify as a business pursuit.

Therefore, if you live in California, you may be in danger of losing coverage for your online publishing activities if you make money from your website or blog, such as through advertisements or a tip jar, unless those activities are temporary or sporadic.

Note that specific language in a policy might lead a court to a result different from the overall state trend.


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