Landlords Should Consider AB Insurance

Credit: Coldwell Banker

By The Mahoney Group  

These have not been kind times to apartment landlords, multifamily real estate investors and owners. 

The COVID-19 pandemic spurred eviction moratoriums nationwide, leaving many owners with no choice but to continue to pay to maintain and finance their properties with less rent coming in and no recourse to remove non-paying tenants. Insurance premiums, meanwhile, have been rising. 

At the same time, a far-less-noticed threat to their investment can be found in the fine print of their insurance policies: Exclusions that are increasingly cropping up for assault and battery claims. 

Landlords can be and have been sued over claims that they’ve failed to ensure the safety of tenants. 

That responsibility goes beyond just cleaning up slippery floors or repairing broken stairs. It also means taking appropriate security measures so that tenants are not left at an unreasonable risk for being victimized in a criminal attack. 

Juries have delivered multimillion-dollar awards to plaintiffs who have sued landlords, particularly if multiple crimes have been committed on the property or if the landlord did not take proper precautions. 

While there’s no doubt that property owners have a “duty to protect” occupants, the question of negligence revolves around the owner “foreseeability” of the violent event. 

As far as insurance goes, a General Liability policy just isn’t enough, especially now that assault and battery exclusions are becoming the norm. 

Landlords, however, often overlook A&B coverage, which helps pay those legal fees and settlements associated with a claim. A&B coverage typically comes in lower sublimits or may be available only through a surplus carrier. (Source) 

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