We have expanded our Property Managers Professional Liability product into a package that addresses the main areas of liability for commercial and residential property managers.
Ineligible Property Managers Professional Package
Please note we cannot offer coverage to the following:
Management of country clubs
Management of farms
Management of hotel/motel
Located in AK, LA or WV
Less than three years’ experience except for vacation home management (one year)
Management or leasing of properties constructed/developed by the applicant or by any related entity
Involvement in setting up Real Estate Investment Trusts (REITS)
Residential managers specializing in the management/leasing of high valued properties greater than ($1,000,000 for individual apartments and $2,000,000 for condo/homeowner associations and 1-4 family dwellings)
Available Coverage for Property Managers Professional Package
Coverage A: Errors and omissions provides coverage if sued while providing professional services in the management or leasing of property
New enhancement: Automatic wrongful eviction coverage provided for the management of residential property
New enhancement: Optional personal injury coverage available for 10 percent additional premium
Coverage B: Tenant discrimination optional coverage for defense and indemnification if sued by a third party for allegations of discrimination
Coverage C: Employment practices liability optional coverage if sued in your capacity as an employer for wrongful employment acts. In addition, our product offers coverage for individuals who are employed by the owner of the building being managed
New enhancement: Premises preferred package optional package available for the property manager’s office that includes general liability written on an occurrence form with optional property coverage on a special form
Coverage Limits Available for Property Managers Professional Package
Errors and omissions limits available up to $5,000,000
Tenant discrimination limits available up to $250,000/$1,000,000 (a limit of only $100,000 is offered in certain high-risk locations)
Employment practices liability limits available up to $1,000,000
Premises preferred package general liability limits up to $1,000,000/$2,000,000 and personal property limits up to $250,000
Claim Example for Property Managers Professional Package
PROFESSIONAL LIABILITY CLAIMS: A property manager was working exclusively with a new luxury
250-unit apartment complex to rent the apartments as they became available. Six months after the
manager began work on this project, only a small percentage of the units were occupied. There were
many factors causing this including the closing of a large area employer, heavy construction in the
area making travel to this complex difficult and the construction of other new temporary housing
developments in the area. The owner of the complex was upset that there were so many units
unoccupied and blamed the property manager. He sued the property manager for failure to rent the
properties in a timely manner and lost income.
ABC Property Management Company was competing for the lease of a large Company that had moved into the area. During the negotiation process, the Company mentioned that they had also been approached by 123 Property Management, another firm in the area and was also looking at their space. The property manager at ABC stated that they had heard negative reviews about how the other property manager maintained their properties. The Company rented space from ABC Property Management. 123 Property Management followed up with the company and heard what ABC Property Management said about them. They sued for slander as a result.
Paul Resident purchased a unit in Happy Valley Homeowners Association. He applied for additional parking permits at the complex, but was denied. Paul and his family often received parking citations issued by the property manager. Paul is Hispanic and spoke to other residents of Hispanic nationality, who also felt that they were denied additional parking permits and given parking citations when non-minorities offenses were ignored. Paul sued for discrimination. (Covered only if Coverage Part B, Tenant Discrimination, is purchased).
A manager for an apartment complex was called when a pipe broke and there was water leaking into one of the units. She called the maintenance worker she employed and asked him to come and fix the problem. The maintenance worker showed up five hours after the call, and the property manager fired him as he had a habit of responding late to emergency calls. The maintenance worker sued the property manager for wrongful termination stating the true reason he was fired was because he had spurned advances the property manager had made towards him. (Covered only if Coverage Part C, Employment Practices Liability was purchased).
A property manager rented an apartment to a student in a college town. The tenant disturbed the peace at the complex, often throwing loud parties that ran late into the night. After numerous warnings the property manager took steps to evict the tenant, resulting in removing their property from the premises. The student sued for wrongful eviction. (Covered only on management of Residential Properties).
PERSONALLY OWNED PROPERTY MANAGEMENT: A minority couple apply to rent one of the properties you own. Due to their poor credit history you decline their application. Shortly afterward you rent the home to a non- minority couple with excellent credit. The first couple who is still in search of a place to rent; see the home has been rented so quickly and sue you for discrimination. They claim you declined their application due to their ethnicity and not their credit history. (discrimination claim)
Your leasing company ABC leasing is losing leases to XYZ Leasing, another leasing company. While trying to close a leasing deal with a local business, you mention to the potential tenant that the owner of XYZ Leasing has been known to be an unscrupulous business man and often voided contracts. The potential tenant then relays what you said about XYZ Leasing and they turn around and sue you for libel/slander.
A property owner rented one of his homes to a young man in a residential neighborhood. The young man came with excellent references. However, he immediately began to disturb the peace in this neighborhood, often throwing loud parties that ran late into the night. After numerous warnings the property owner took steps to evict the tenant, resulting in removing their property from the premises. The young man sued for wrongful eviction.
PREMISES ONLY PACKAGE CLAIMS: Jack, the owner of Jack’s Slacks has missed two month’s rent payment due to family issues. The property manager agreed to give Jack three month’s grace period before taking legal action. Jack just received a final notice of payment in the mail from the property manager and storms into the property manager’s office to discuss. Jack trips over the cord to the fan and falls to the ground. Jack breaks his arm and sprains his ankle. Jack sues for damages.
Bruce, the owner of the Management Man, takes the afternoon to work on some paperwork back at the office. As he is working on the computer, a thunderstorm rolls through causing a power surge. Bruce sees some sparks shooting out of the computer resulting in a fire. As a result, of the fire the computer’s hard-drive is destroyed. Bruce needs a new hard drive to get back up and running.
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