We were flipping through an older issue of Insurance Journal the other day and came across an article with this headline: “The Complicated Risk Exposures of Property Managers and Investors”. We were okay at first, especially when we read this:
Property managers and real estate investors face bedbug exposures, mold behind the dishwasher, tenant and vendor service issues, tenants without insurance, vetting contractors, insurance claims, property inspections, tax authorities, tenant harassment and discrimination claims, and more.
That’s nothing but true, fair, and accurate. But this part freaked us out a little bit:
In most cases, the property manager is responsible for tenant screening and placement of the tenant in the investor’s property, which leads to another potential financial exposure for the property manager … Medical payments, property damage to others, additional living expenses, and contents coverage are not required or reviewed.
The fact that property managers may not be aware of the extent of their exposures is bad enough. But what really freaked us out was the reality that all those claims — whether the property manager saw them coming notwithstanding — will have to be managed.
If you were using Excel, you could record an incident. Then, if you were able to tell what claims resulted from that specific incident, you could put links to those claims in other spreadsheets or documents. That feels like a dicey proposition because it feels like a pretty big if.
When we got to this part of the article, we completely flipped:
Property management firms often assume that by having their investor add the property management firm as an additional insured on the investor’s personal homeowners or commercial multi-family policy they can mitigate all their liability exposures related to the servicing of the individual property … [but] they may be facing uninsured losses due to vacancy clauses, intentional acts or damage by the tenant, and “service animals” that could take down a moose.
The potential liability inherent in vacancy clauses and intentional acts or damage is scary enough. But the idea of heading out to a property inspection and having to face off with a service animal that could take down a moose, is terrifying — especially if the resulting claims have to do with a leg in the service animal’s choppers.
You could trust all that to Excel. Or you could use Cloud Claims. Cloud Claims won’t protect you from a service animal that could take down a moose. And it won’t read your policies for you. But since it connects incidents to claims — and claims to policies — it will protect you from disorganization and inefficiency. And it’ll help you identify patterns, assess risks more effectively, and mitigate them accordingly.
Note to Self: Give service animals a much wider berth.
