At Sacramento Delta, we are property management experts who know a lot about insurance. But when it comes to insurance matters, we want you to hear directly from an expert in insurance. So, we’ve invited Kurt Bullock with Bullock Insurance to talk to us about what it means to add your property manager as an additional insured to your policy. It can be difficult for a lot of our new clients to understand, especially if they’ve never heard of it before.
Liability Coverage for Owners and Property Managers
If you have an income property and you hire a property manager, you’ll usually end up signing a management agreement. In that management agreement, there is usually an indemnity clause. When you add your property management company to your landlord policy as an additional insured, you’re protecting everyone who deals with the property and the tenants.
For example, if a tenant had a party and a guest was injured and there was a lawsuit, both the landlord and the property owner would be named in the lawsuit. So, when that lawsuit gets turned over to your insurance company for representation, you want all parties to be protected from liability. This is called premises liability. A few carriers will include this for you without any charge, and it’s the best way to protect your property.
Property owners have a laundry list of policies available to them when they’re buying insurance to protect their investment property. As property managers, we provide our owners with eviction protection. We don’t cover the loss of rent because there’s an insurance rider for that. When you have lost rents, you can recover that money through your policy.
Serving Tenants Better as an Additional Insured
During the fires in Paradise and the floods in Houston, we also found out that property managers who were listed as an additional insured on the owners’ policies were able to get help for their tenants faster. We have a lot of investors who don’t live in California, and getting to the site of a disaster right away is impossible. When the property manager is an additional insured, we can act on your behalf immediately. That’s an added benefit that we didn’t know existed until we saw our fellow NARPM members go through it. It’s another good reason to add your property manager as an additional insured.
Additional Insured versus Additional Interest
Sometimes, a landlord insurance policy will add a property management company as an additional interest. That is different than additional insured. They kind of sound the same but additional insured means the property manager is covered under the liability section of the policy. Additional interest simply means that when the policy experiences a change, such as a renewal or cancelation notice, the property manager will get a copy of that notice. It does not offer any liability protection at all. There is no protection when a management company is named as additional interest. It’s a huge difference, and you want to make sure you’re adding the company as an additional insured.
If you have any questions about this, please reach out to us at Sacramento Delta Property Management, and we’d be happy to share more information.
Rental property maintenance requires responsiveness, budgeting, and a great network of professional vendors and contractors. All of us work at Sacramento Delta Property Management to ensure the properties we manage are well-maintained. Today, we’re talking a bit about our process as a professional property management company.
Working with Trusted Vendors
You need to always be on the lookout for good vendors. In our industry, if someone hears about a great vendor, everyone tries to get to them and they get booked up quickly. We’re constantly looking for competitive rates with our vendors, and we do work with some awesome long-term vendors. Many of our maintenance partners have even been with us for over 35 years. Some will only work with Sacramento Delta and smaller companies. This makes it easier to keep the rates low. They don’t have to advertise or market themselves because they get enough business from us.
Maintenance costs are always on the rise. We do our best to keep costs contained, but there is always inflation, and repairs and parts are not going to cost what they did five years ago. Many of our owners benefit from our discounted pricing negotiations with our best vendors. When you work with us, you get a much better price than you would if you were self-managing or getting your management services elsewhere.
Invoicing transparency is important to property managers. As an owner, you’ll receive the original invoice with the exact information from the vendor. There is no hiding anything and we don’t have any hidden costs or upcharges. The owner gets the exact original invoice and we only keep a copy of it for our records. Transparency is important and so is documentation. We like for each property to have a detailed record of exactly when and how things were repaired.
Comparing Maintenance Prices
We also have a long list of licensed and insured contractors to choose from for our bigger ticket items. We will always get second or third opinions when necessary. These vendors are insured and licensed and bonded, so if something is not done completely or correctly, we can always go back to them and have it handled. They are liable for the work that they do, and a lot of times we won’t even pay an invoice until we get a clear photo of the completed work.
For larger projects, we keep things as cost-effective for our owners as possible. We are always looking for ways to save money for our clients because at the end of the day, we want the best-case scenario.
It’s not uncommon for our clients to send one of their own vendors out to get an estimate after we have provided our own estimates. Usually, our vendors are more affordable.
Gathering competing quotes isn’t always possible. If it’s an emergency and a new furnace or HVAC system needs to be repaired immediately, we get it done because it’s a habitability issue. We can’t have tenants without a place to live.
In-House Maintenance is not Always Best
In-house maintenance is always an interesting process for repairs, and it has both benefits and drawbacks. There can be some pretty high bills when companies use their own maintenance teams. Having a neutral third party take care of these repairs will provide more accountability. And, it reduces liability.
The main goal is to get the item fixed, not to make additional money off our owners. Upcharges and additional fees just for coordinating maintenance is not something we agree with as a company. This is included in your management fee and should not be charged additionally.
We are very transparent, and we are never going to throw in hidden fees, especially for maintenance. Our clients also appreciate getting to know our vendors. They know our HVAC guy or our plumbing guy and they know they can trust the work.
At Sacramento Delta, we have a motto that deals with the four “F-s”. Those F-s are:
- Be Friendly
- Be Flexible
- Follow Up
- Fix the problem
If you’d like to know more about our maintenance process, please contact us at Sacramento Delta Property Management.
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