Portland Property Management How To: Insurance

At Fox Management, we have some specific insurance requirements in place for the property owners who work with us. The most basic version of insurance coverage for rental property owners is called a landlord policy. Basically, when you are renting out hour house, it’s like having your own business. If a member of the public is injured on your property, for example if they slip and fall and get hurt, that may result in a lawsuit. So, we want you to have enough insurance in place that you won’t have to worry about that liability. The insurance will pick up the claim, hire lawyers if necessary and defend you against any lawsuit resulting from a bodily injury, such as a slip and fall.

When you work with a property management company such as Fox, we become your agent. This means the tenants are essentially renting from the property management company instead of directly from you. For that reason, Fox Management needs to be added to your landlord policy. That way, if there is an accident or a liability concern and a lawsuit is filed, the insurance will cover you as well as us when the claim is defended. The landlord policy is different from a homeowner’s policy. The homeowner’s policy will cover the contents of the property, and a landlord policy does not. Specifically, we look for a million dollars in liability coverage, which is pretty standard in the insurance realm these days.

There have been several instances where having a good landlord policy in place has helped us as well as our landlords. We had a case where we got an apartment ready for new tenants. The previous tenants had pets, so we put fresh paint on the walls and gave the place a thorough cleaning. The first night in the home, the tenant and her daughter slept on the floor and got bit by fleas. We had not noticed any fleas while we were in the place cleaning, but the very next day we got a pest control company out there to take care of the fleas. To make a long story short, the tenant ended up suing us for $100,000. Obviously, we weren’t anxious to pay her $100,000, and she had named both the owner and Fox Management in her lawsuit. The insurance stepped in and took care of this frivolous claim. This is a good example of why insurance is so necessary.

Of course, insurance does not cover everything. For example, if you have a mold problem in a property and someone gets sick from the mold, a lot of insurance policies will have a mold exclusion. Insurance is a great layer of protection, but remember that it doesn’t cover all the possible problems that can occur. For day to day operations at your rental home, your landlord coverage will bring you great peace of mind.

If you have any questions about insurance or how to choose the right policy for your rental home, please contact us at Fox Management, and we’d be happy to help you out.