Top Risk Management Tips for Property Managers and Investors

• Ensure your general and professional liability insurance policies adequately protect you. If you’re not sure what adequate coverage means for you, then give me a call. I’m happy to help.
• Make sure your lease requires tenants to carry liability insurance. In the past, leases have typically required $100K in coverage for single and multifamily units. However,many have started requiring $300K. For commercial tenants, a typical required coverage is $1M.
• Consider implementing a Property Damage Waiver Liability Program for single/multi-family tenants who fall out of compliance or do not want to get their own insurance.
• For those who fee manage, keep your management agreement up to date. In addition, require the owner/investor to carry adequate insurance and list your company as an additional insured. If getting your clients to comply has been challenging, I suggest looking into a Master General Liability Program. You want the owner’s policy or the master policy to defend you first.
• Implement a certificate of liability insurance process for all contractors. Anyone doing work on the premises must be adequately insured. I find that even established companies slip in this area.
• Join a trade association. Being an active trade association member can help you stay up-to-date on local and national laws regarding your business regulations and compliance. Trust me, this is one of the best things you can do as a property manager!
• Inspect the property annually. That said, biannual inspections of all mechanical components and the building are better. Believe it or not, some companies don’t do this.
• Document, document, document! Anyone who files a claim against you must prove negligence on your part. Documentation is one of the best ways you can defend against their claims. The tenant will always have the upper hand, and you will be held to a higher standard because you are deemed to be “In The Business Of.” It is vital that you have aprocess to help you stay on top of documentation.

This list of risk management practices and tools could go on and on, but the items above are a few of the most important. If you have any questions about the tactics above or want to hear about even more risk management resources, I’m happy to connect with you.

Keep an eye out for more property management and investor tips from me! My goal is to help you be your best!