In this explosive real estate market in North Texas, real estate syndication has become a popular way to acquire real estate. Below, we’ve enclosed a list of exposures and coverage(s) that a property syndicator needs to consider along with some options of how to arrange these.
- Property insurance: This is the coverage for the building, office contents or equipment owned by the management company. It can also include laptops and computer hardware.
- Information needed: Valuation of contents or building owned by the manager either at a main location or at satellite locations
- Employee Dishonesty: This protects the property manager from theft by their own employees including cash or checks or money orders.
- Information needed: Number of employees
- Business Auto coverage: This can include the vehicles owned by the management company, as well as insured the management company for employees using their own vehicles in the course of employment.
- Workers Compensation: This exposure can vary, some managers employee all the personnel while some managers put the local personnel under the direct employment of the property owner. Texas is one of the only states where workers compensation is optional.
- Information needed: Annual payroll broken down by classification, leasing, bookkeeping, maintenance, make ready, central location supervisor
- General Liability: Most generally liability coverage for a property will provide coverage for the property manager as well, but it also makes sense for the management company to have general liability coverage in the name to avoid any gaps. Why depend on another company to insure your risk?
- Information needed: Annual receipts for the property management firm, the amount the management company retails in fees for management.
- Errors & Omissions: This is professional liability that will include coverage for discrimination.
- Directors & Officers Insurance: this policy covers claims resulting from managerial decisions that have adverse financial consequences
- Master Insurance Policy: Some real estate syndicators will put together a master policy to include all of the insurance coverage for their properties.
While this is certainly not a complete list, it is hopefully provides enough information to shed some light on the various gaps in exposure that can lead your business prone to risk. At Ramey King, we’d love the opportunity to talk more with you about protecting your business today.