All Forum Posts by: Eric Belgau

Hi @Tim M. Just commercial general liability and E&O. The right carrier and specific coverages will depend on what's "under the hood" of your business plan. Odds are, you'll want Travelers.

Best of luck!

When we went to register the deed, there was an issue with how the property description fit on the page.  (Like an earnest collegiate note-taker, it had violated the margin!)  The woman at the County told us that it wouldn't work and explained how to correct it.  So we did.

In Thurston County we're blessed in a lot of ways...and one of them is that something of a small-town mentality still persists.  So we were able to figure it out, even though we made some mistakes; and we end up with a recorded, valid deed and title insurance.  We did pay for the title search, and there was an issue that had to be remedied.  

I bought this parcel as a privacy buffer.  It's a hill with woods on it, and if I put a yurt at the top of it I'll have a nice little camping spot with a Mt. Rainier view a short hike from my front door.  If I was doing it as an investment, or buying a lot of them, I'd probably figure that my time was worth more than the added cost of paying the escrow fees.  In this case, I got to feel like I was stickin' it to the man by not paying someone a bunch of money to hold a check for thirty seconds...and I learned something.

@Bryan L. Possibly a dumb question, but if you don't record the deed, how does the County know who to send the property tax bill to?  

@David A. Texas labor rules are not the most progressive, but the Texas Department of Insurance does have resources available.  http://www.tdi.texas.gov/wc/employee/index.html

That's probably the best avenue for your friend to explore first.  Employee injuries are excluded on General Liability policies, and the boss's insurance company will almost certainly classify your friend as an employee.  

If the boss didn't have a formal employee relationship with your friend, he was almost certainly excluded from WC premium calculations.  This could create a lot of blowback for the boss, so the situation could become pretty nasty.  If the WC claim appears to be valid, your friend should ask about what rights/resources he has if his employer retaliates against him.  

@Franco Vallejos We did end up preparing our own documents.  It was my first time doing it, but the transaction took long enough that I had become friendly with the seller.  That made it easier.  We found a very helpful person at the title company and a very helpful person at the county.  All in, including title insurance, it cost just less than $300.  

@Theodore B. A couple of points.

First, if you have rental properties without liability insurance on them and something happens, having the LLC isn't likely to help. You'll be a guy with a lot of properties who wasn't willing to spend a few bucks a month on insurance, and a good tenant's lawyer will relish the opportunity to pierce the veil of the LLC. Or just go after all the assets in the LLC, which would wipe out the property holdings.

Second - and on the upside - you have enough properties to get a blanket policy to cover all of them, which should reduce the rate per door.  Talk to a local broker who can get you a good policy, given any particularities with the properties.  If you want to save money, save it on the property portion of that coverage, insuring for Actual Cash Value rather than Replacement Cost, but make sure you have adequate liability limits.

Third, umbrella insurance isn't a standalone liability policy.  It sits on top of the underlying limits of your other policies, such as homeowners, auto, landlord, etc.  Without those policies, you have liability insurance with, say, a $500,000 deductible.  That comes out of your pocket before the coverage kicks in.

The basic policy for a rented property is a Dwelling Policy, which covers the property (on a Replacement Cost or Actual Cash Value basis, or on some hybrid of the two), appurtenant structures (up to 10% of the value of the property) and basic liability.  The default liability limit is usually somewhere around $300,000, but you can increase that.  The additional premium for doing so is usually negligible.

You should also add loss of rental income - again a pretty small premium increase for valuable coverage.

Insurance companies have been adding value to these policies by including various tools to help landlords manage their properties, as well as adding packages of endorsements.  Some companies have dedicated products for landlords (like AmFam's Rental Dwelling Property Policy), and some carriers write landlord policies as Businessowners Policies (commonly called BOPs).

The primary rating basis is the valuation of the property.  Other risk aspects, such as the proximity of a fire hydrant and the age of the building, also play a role.  Claims history can have a significant impact on rate.

It's very difficult to compare apples to apples because of the way that various carriers add value to their policies.  You need to dig into the policies to see if the added coverages and tools are valuable.  (For example, if you're using a PM you don't need tenant screening tools.)  And it's important to work with a broker who understands who you are, what you have, what you need, and what the market can provide.

Hope that helps.

@Tiffany Brewer 

This sounds like substantial property damage, so USAA should get involved.  You should file a claim ASAP and get the adjuster out there.  If the damage is into the tens of thousands of dollars, you might also consult with a good public adjuster.

Normally, your insurance company should pay for all covered losses.  They will also have the right to subrogate against your tenants (go after them for damages) and collect what they can.  You can expect to see a rate increase as a result of this when your policy renews, so you might start looking for a quality insurance broker well ahead of your renewal.

@Tamara R. 

The key difference here is that the leak is a gradual event.  Failing to notify you might make your tenant technically liable for the damage, but it doesn't make the leak itself a covered cause of loss.

Bill is right.  Your previous landlord may have wanted you to get the insurance from his agent.  I don't believe the laws in California would have allowed him to have any kind of "arrangement" with the insurance company (aside from a referral) unless he was an agent himself.

Ask your tenants to list you as an additional named insured on their renter's insurance policy.

@Sarah Jones When you say your insurance only paid out the minimum but gave you a lawyer for defense, I assume you mean that the claim hasn't yet exhausted the limits of your policy.  If that is correct, then you're not at the end of the road yet.  That's the good news.

The bad news is that the rules governing the collection of settlements from auto accidents tend to favor the victim.  Those rules are state-specific, so your best bet is to talk to your lawyer (or agent, if you have trouble reaching the lawyer).  This is really something you should seek professional advice on

@Tiffany Plovie I just saw this.  I'll be there...and I didn't know it was so "upcoming" when I offered space for one...  Looking forward to it!