A Quick Landlord Insurance Guide for Apartment Owners
By Pekin Insurance · Sep 9, 2019 ·2 min read
Would you water-ski and juggle chainsaws at the same time? No! That's a terrible idea.
Do you know what else doesn't make sense? Being underinsured when you own apartment buildings.
Check out our quick landlord insurance guide to account for the complexities that come with apartment ownership.
Business Property Coverage
Business property coverage applies to much more than apartment buildings. It's designed to cover swimming pools, garages, fences, and other structures on the property.
Property insurance goes to work when you experience:
- Certain kinds of water damage
- Specified natural disasters
Depending on which plan you choose, business property insurance could cover computers, inventory, equipment, and loss of income.
General Liability Coverage
General liability usually covers:
- Legal fees
- Medical expenses
- Property damage you or your employees are responsible for
You take plenty of measures to make your apartment buildings safe, but tenants and their guests could still slip, trip, fall, or have other accidents.
According to AllLaw, you could be held accountable for these injuries under certain circumstances. This is when general liability insurance kicks in to cover your business.
Commercial Auto Insurance
Do you employ maintenance workers, and do they go from one property to another in company vehicles? If that's the case, you need commercial auto insurance.
If your crew uses personal vehicles for business purposes, those vehicles should be insured with commercial auto coverage, too.
- From an insurance perspective, personal policies are personal policies and business policies are business policies. Once you start using personal belongings for a business, they're business items.
This scenario shows what that means:
While working, one of your employees backs his truck into a tenant's car. He has personal auto coverage for his truck. Because the truck is being used for business purposes, the employee's insurance company might not cover the claim.
Think about all the physical work that goes into maintaining your apartment buildings:
- Fixing pipes and other plumbing components
- Hauling heavy bags of mulch for landscaping
- Troubleshooting HVAC problems
- Updating electrical wiring
These tasks put a lot of stress on the body, and they could cause injuries. Workers Compensation typically covers medical bills, lost wages, and funeral costs for an employee after a work-related illness, injury, or death. It's a crucial part of any landlord insurance plan.
Workers Compensation doesn’t just cover severe injuries like:
- Broken bones
- Muscle tears
It also covers:
- Chronic injuries that form over time
- Illnesses that develop as a result of the work environment
- Psychological or emotional damages (depending on the state)
Equipment Breakdown Coverage
“My air conditioner broke down, and it's 98 degrees today!”
Tenants don't want to wait forever when the air conditioning quits, so you take care of the issue right away or have your maintenance crew handle it.
Equipment breakdown coverage pays for physical damage to equipment caused by mechanical and electrical breakdown.
This coverage protects against covered losses caused by:
- Boiler damage
- Electrical arcing
- Motor burnout
- Operator error
- Power surges
- Short circuit
Talk to your agent about adding equipment breakdown coverage for:
- Electrical distribution systems
- Heating and cooling systems
- Refrigeration systems
- Telephone systems
To clarify, equipment breakdown coverage doesn't pay for normal wear and tear to equipment.
Talk to your local Pekin Insurance agent about bundling coverages to save on your landlord insurance policies.