Commercial Liability Insurance

5 Replies

I own 2 properties in Florida. One is a long term rental and the other is a vacation rental (short term rental) and I live in Maryland. Each property is currently held in my personal name and each is insured by its own landlord policy. After spending lots of time reading many posts here on BP regarding insurance, I've decided to go with an additional Commercial Liability policy to supplement the landlord policies to cover both properties.

Since the liability insurance is with a different carrier different than the landlord policies I was told I will have to remove the liability insurance from the homeowners policies so the new commercial policy (3 million) will cover any liability.

In general, am I giving up any liability coverage from the landlord policy that may not be covered by the commercial liability policy when I terminate that coverage?

Just trying to make sure I'm not missing something.

Hey @Chuck Masters I am not an insurance agent or know the answers to your questions but why do you have 2 policies?  Why don't you find 1 landlord policy that covers liability for your vacation rental as well as damage.  My insurance covers my liability ($1 million per property) plus covers dwelling at no additional cost.  The only caveat is you have to find a policy that works for short term rentals. 

Chuck,

It sounds like you're complicating it...  As an insurance agent, I would recommend keeping your dwelling policies as-is and buying a personal umbrella policy to increase your liability coverage.  It should only cost a few hundred dollars per year and also benefits your family in other ways.  I would suggest contacting an independent agent if you're not already working with one.  They will have many options for you.

Agree with @Jared Newsom . I have one LLC, one bank account, one spreadsheet, one Cozy account and one umbrella policy for 17 SFHs. $2M umbrellas is around $1,200 per year.

@Jared Newsom I would normally agree with you but the vacation rental is the wild card in this equation. A vacation rental is the one circumstances that wouldn't be covered with just an umbrella policy. When I first started looking into insurance I was looking for an umbrella policy and agents here on BP and in Florida both said that an umbrella policy would not be adequate.  There are two companies CBIZ and Proper that specialize in this liability insurance but because they are small and Florida is a specialized state for insurance the rates after adding wind coverage are 3 times what a normal policy costs.

I have contacted many independent agents in Florida and I was amazed at how many agents that know very little about how to insure a vacation rental. I learned most of what I know from folks here on BP.  

My question was what am I missing by dropping the liability on the landlord policies and having only the commercial liability policy.   

Originally posted by @Chuck Masters :

@Jared Newsom I would normally agree with you but the vacation rental is the wild card in this equation. A vacation rental is the one circumstances that wouldn't be covered with just an umbrella policy. When I first started looking into insurance I was looking for an umbrella policy and agents here on BP and in Florida both said that an umbrella policy would not be adequate.  There are two companies CBIZ and Proper that specialize in this liability insurance but because they are small and Florida is a specialized state for insurance the rates after adding wind coverage are 3 times what a normal policy costs.

I have contacted many independent agents in Florida and I was amazed at how many agents that know very little about how to insure a vacation rental. I learned most of what I know from folks here on BP.  

My question was what am I missing by dropping the liability on the landlord policies and having only the commercial liability policy.   

 Chuck, just to clarify, an Umbrella would not be adequate for any rental, not just a vacation rental.

As for the difference between the landlord liability policy and the commercial liability policy, you would need to compare the insurance forms for the policies you are considering.

Typically, there is no difference between a landlord liability policy and commercial general liability policy.   Only the specific Exclusions or Endorsements the specific insurance companies add.

The advantage to going with a CBIZ or Proper, is they have the Endorsements the enhance coverage for a vacation rental that are typically not on a generic Landlord policy or Commercial General Liability.

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