About Insurance Policies for Landlords
Aside from property insurance policies, landlords may also benefit from carrying other policies such as liability insurance and equipment insurance as well as making certain that tenants and contractors are insured. Here are a few policies for landlords to consider and, if needed, get an insurance broker's advice.
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Property Insurance
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Property insurance includes general liability coverage, losses to the structure or any owner property on the premises and what is known as "building ordinance." This covers portions of the building that don't suffer damage in the event of a loss or extra construction required as part of the reconstruction, such as wheelchair ramps.
Boiler and Equipment Insurance
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Property insurance often doesn't adequately cover equipment breakdowns or damage from the breakdown, for example, a pipe breaking and flooding the boiler room. These insurance policies also cover inspections needed to issue a contract that can be used to fulfill municipal inspection requirements.
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Renters' Insurance
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Many renters don't know that your property insurance doesn't cover loss of their personal property. Several experts advise landlords to require their renters to have renters' insurance.
Additional Liability Insurance
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You can include additional "umbrella" liability coverage or coverage specific to an event like when you're doing remodeling work. Owners who operate their rental property as a business entity like an LLC or corporation may also consider directors and officers' liability insurance to protect against claims of mistakes or mismanagement.
For Landlords with Employees
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If you employ a superintendent or property manager, you must carry workers' compensation and disability insurance for job-related and off-the-job injuries or face stiff fines and personal liability. Remember that state laws have strict definitions of employees that may include someone you think is a contractor. Fidelity bonds protect against theft or illegal conduct by employees.
Contractors' Insurance
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Contractors and subcontractors should carry enough general liability, workers' compensation and automobile insurance to protect you against losses and injuries during their remodeling work. Always ask contractors and their subcontractors to produce copies of their certificate of insurance and review it to make sure it provides adequate coverage.
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References
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