Q&A: Got Coverage? Have Your Insurance Premiums Gone Out of Control?

Industry News,

We recently hosted an AAGLA Member Webinar with Newfront Insurance titled “GOT COVERAGE? HAVE YOUR INSURANCE PREMIUMS GONE OUT OF CONTROL?” where we covered the state of the California insurance marketplace, and what insurance products can offer YOU the best type of coverage that can protect you from risk of loss. We had multiple members write in questions regarding the personal coverage, umbrella insurance, liabilities policies, and more.

We understand your concerns at the time and have provided in-depth answers in order to help you better understand the multiple insurance policies offered by Newfront Insurance that could help save you thousands in premiums and liabilites.



My experience is insuring carports is unusually high – companies are treating car ports as separate buildings – so adding equivalent “liability” coverage to car port at same rate as to primary building. Any way around that/to reduce that? Some companies do treat them as separate buildings, some do not. It is always more advantageous when the definition of “Building” in the policy includes carports as it prevents any mistakes on listing/covering carports, nor do you get charged for it when it is automatically included. If you wish to explore other options, you can connect with Keane offline by email at keane.heller@newfront.com or by phone at 650-787-2227
Is $100,000 for tenant insurance sufficient? What are acceptable coverages and coverage amount that landlords should be asking for? It is preferred to carry a minimum of $300,000 liability limits, and we believe Landlords should require that limit at a minimum. $300,000 limit will likely not cover the cost to rebuild the entire building, but it will at least contribute to the claims payment and can address damage to a few units.
If we were a renter, we would purchase the highest liability limit possible, as the additional cost is marginal.
With regard to umbrella insurance coverage, does it matter that if I have three properties are owned under three different LLCs? So long as there is common ownership between the LLC’s, then you can combine all three properties on one umbrella policy. Typically, combining as many properties on one umbrella is the most cost effective way to go.
Do you recommend umbrella insurance as an add on for all properties or just ones perceived as higher risk? Would you recommend umbrella in place of other types of policies (Pollution, cyber, etc) to get greater coverage? Umbrella is best to be blanketed across all locations you own. You can have 1 umbrella go over multiple locations/policies.
Can I purchase umbrella insurance for a warehouse or office building? Yes, you can. Newfront Insurance has umbrellas available for any type of real estate that you have.
Is it a good idea to hire an attorney or insurance adjuster to handle an insurance claim? Unless you intend to sue the insurance company, we would prefer for you to lean on your broker and their claims team to advocate for you. We are firm believers that the person who designed your policy and made a representation about what it covers should be involved in helping you deal with adjusters and any hiccups you may encounter during the claims procedure.
Regarding Insurers plumbing replacement request, are there any plumbing monitoring systems or leak prevention systems that you are aware of? There are a number of readily available systems. Some are inline with the water supply (i.e. Flow by Moen) and others can monitor at the meter (i.e. Flume). Flow has shut off capabilities whereas Flume is more of monitoring for slow leaks, etc.
Each of my rental properties are owned within separate single member LLCs owned by me, but my umbrella insurance provides only personal coverage. What happens to if I have a claim? Will the claim be covered by personal umbrella coverage? Generally, your personal umbrella will exclude all business exposures and LLC’s. There are some stand alone umbrella options that can include the LLC if it’s specifically for holding properties and doesn’t have any other business exposures. Feel free to contact Ryan for more specifics: ryan.tice@newfront.com or 916-804-3359
What about Comprehensive Personal Liability policies as an alternative to individual policies for condo’s rented to others? Comprehensive Personal Liability or “CPL” policies are an alternative but ONLY provide premises liability coverage and no property coverage. The individual package policies would provide both property and liability coverage.
The City Council of Los Angeles will be meeting regarding a new “Tenant Anti-Harassment Ordinance.” Is it possible to insurance against tenant harassment claims? Yes, a Tenant Discrimination policy can protect you against harassment claims.
What is title policy insurance and is it worth purchasing? This is typically purchased through an escrow company and is to mitigate the lender’s risk.
Where do you find workers compensation insurance for just $300 to $400 per year? I have just one employee and pay over $1,000 per year! Newfront Insurance provides certain programs that specialize in apartment workers compensation.
My insurance company is requiring that I re-wire and re-pipe at my property in order to renew my insurance policy . There are NO problems with the existing plumbing or wiring. This will be very expensive. Is there anything I can do? A re-wiring and re-piping of the building seems quite intense, and our clients have not had to go through that ever. What we suggest doing is going back to your broker to see if they will allow you to have the wiring ends pigtailed with copper wiring or if you could cap the ends with COPALUM or similar wiring connectors. Regarding the plumbing, this one is tricky because there is nothing you can do to mitigate the exposure….time to consider switching!
Regarding renter’s insurance, what liability coverage levels do you recommend and what are the approximate costs of premiums? Are there coverage exemptions that I should ask my tenants to procure? Renter’s policies are usually around $120-$150 per year. We recommend purchasing at least $300,000 of liability limits. There are no particular coverage exemptions that are needed – renters insurance is rather basic.

**This Q&A is for general information purposes only. Before acting, be sure to receive legal advice from an attorney.

Got More Questions?
Call Newfront Insurance
At (855) 830-8954 or
visit AAGLAsavesU.com