What property managers and leasing agents should know about insurance policies
05/23/2016 | Author: Editorial Staff
With multiple types of insurance, sometimes complicated claims, and varying exemptions and contract discrepancies, insurance issues for property managers and leasing agents can quickly become complicated. A webinar hosted by TAR last week covered some common ways property managers can reduce their chances of claims.
For the two major types of insurance commonly encountered by property managers and brokers or agents involved in leasing—errors and omissions and general liability—the main thing to keep in mind is what activities you will be involved in. For brokers or agents involved in leasing, most claims will fall under E&O insurance. Property managers also need general liability insurance for claims that might involve injury to a person or damage to physical property, but these policies often require E&O insurance to be held, as well.
Here are some other items property managers and leasing agents should keep in mind when considering insurance issues:
- Check your E&O policy to determine what occupations are covered. Make sure that property management is included, either under “covered occupations” if you have a traditional E&O policy or on the declarations page if you have a miscellaneous E&O policy.
- Agent-owned properties are often excluded from E&O insurance coverage. After all, if you’re both the agent and the property manager, you’d be suing yourself in almost any situation.
- Know whether the contractors you’re hiring to work on your property have their own workers compensation insurance. Many small contractors do not carry workers comp policies.
- Some of the most common types of claims include failure to screen tenants for financial stability, failure to maintain property in a safe manner, failure to maintain accurate receipts and records, alleged violations of the Fair Housing Act or discrimination, and failure to locate renters for a leased property.
- Using the right forms consistently can help mitigate your risk. TAR’s Residential Lease Application (TAR 2003) and TAR’s Model Tenant Criteria Selection Form, found under risk-reduction tools, are just two forms which may be used during the tenant screening process. You can also find more forms related to leasing and property management in the TAR form library or through zipForm.
The full audio of the webinar and accompanying slides are available for members at texasrealestate.com under past webinars.
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