March 27, 2018
Do You Really Need Residential Property Management Insurance?
If you’re in the property management business, know this: Insurance is NOT the place to cut corners.
As someone who rents or leases residential real estate, or manages rental properties, it’s essential that you protect your business, your buildings and yourself. The sad but simple fact is that lawsuits are common in this industry. And whether the issue is property damage, negligence, personal injury or wrongful discrimination, the costs can be heavy.
Don’t expose yourself to unnecessary risk. Get the right insurance you need to stay in business, protect your reputation and cover any costs that might come up.
What Type of Property Management Insurance Do You Need?
As a property management professional, your clients expect you to be insured. You need coverage for liability, workers compensation and health coverage. You also need industry-specific insurance against things like property damage or loss due to fire, water, vandalism or theft.
Here are the three key types of insurance no property manager should go without:
General Liability Insurance. This covers your day-to-day business practices. It protects against negligence claims, such as if a resident, employee or visitor sustains a personal injury while on your property. So you’ll be covered for any medical or legal costs. It also provides third-party liability protection against property damage caused by employees or contractors.
Errors and Omissions Insurance. Also known as E&O, this professional liability insurance protects service providers against claims for inadequate work or negligent actions. Compared with general liability insurance, E&O offers coverage that’s more specific to property management, including protection against claims for invasion of privacy, wrongful eviction and hiring unlicensed contractors.
Tenant Discrimination Insurance. This coverage isn’t always provided by general liability policies, so you should determine whether it must be added to your policy. Tenant discrimination insurance protects property managers when current, prospective or former tenants allege wrongful discrimination, such as being unfairly evicted or denied application.
Protect Yourself by Protecting Others . After making the time and effort to be sure your own insurance policies are in place, don’t miss this key component of protecting yourself from other unnecessary costs and liabilities: Ensure that your tenants are also insured.
Resident Insurance. If a tenant causes property damage (for example, starting a fire or a leak), they’re responsible for the cost of repairs. But if they don’t have the necessary insurance to cover damages, you could find yourself covering some hefty expenses, including construction, court fees and increased insurance premiums. Many renters mistakenly assume that their belongings are covered by their landlord’s insurance. Or they fail to secure enough insurance to replace their property or protect against liability if they cause damage to your building.
Not only that, but if tenants lose their belongings due to damage or theft and aren’t insured to replace it, they may have trouble paying rent while they recoup their losses. By ensuring sure that resident insurance is in place, you can help protect your revenue stream.
As an added bonus, advising renters to secure the right insurance lets them know you care about them and are thinking about their best interests.
How Property Vista Can Help
The bottom line is this: If you’re in the residential property management business, you need insurance. Get enough coverage to protect the property and assets you manage, and ensure that your renters have the right policies in place.
Our cloud-based property management solutions include an online resident portal that automates the renter’s insurance process and provides access to real-time status on all resident insurance policies. So you’ll know which tenants have coverage and whose policies are about to expire.
To discover how Property Vista can help you protect your business while delivering exceptional customer service, sign up for your account today or give us a call.