What insurance coverages should apartment building owners look for?
Insuring an apartment building is complex, and it usually requires several coverages. Some important protections to consider are:
- General Liability: Normally insures against common accidents that occur at apartment buildings or elsewhere on apartment properties.
- Professional Liability: Normally insures against errant guidance that employees might give to current or prospective tenants.
- Commercial Umbrella: Normally offers a secondary level of liability protection, providing extra coverage for covered lawsuits that are especially expensive.
- Commercial Property: Normally insures buildings and other improvements on an apartment property.
- Boiler and Machinery: Normally insures major equipment installed in apartment buildings, such as air conditioners, furnaces and hot water heaters.
- Commercial Contents: Normally insures items not permanently installed, such as appliances, decor, and furniture for furnished apartments.
- Backup and Sewer Drains: Normally insures against water damage resulting from plumbing leaks, backups and overflows.
Other coverages, such as commercial auto, employment practices liability, and cyber insurance, are also normally available. A knowledgeable insurance agent can help apartment owners determine whether they should have these or any other protections.
Are earthquakes and floods covered in apartment building insurance?
Standard apartment building insurance policies typically exclude coverage for both earthquakes and floods. If coverage for these risks is required, it may be obtained through separate policies.
Flood insurance might be available through the National Flood Insurance Program and private marketplace, depending on a property’s location. Earthquake insurance might be obtained through the private marketplace.
Do apartment building policies cover tenants’ belongings?
Apartment building policies are primarily for the building and owner/investor. They normally don’t offer any protections for tenants or their belongings. Tenants should, instead, be encouraged to get their own renters insurance.