Generally, as a property manager you can recommend the types of insurance
your property owners should have, but it will be up to them to determine what
they end up purchasing. However, you are able to write the rental contract in
such a way that prevents you from being held liable from an injury that
occurred at a property you manage.

If you are the property managers, you should be able to set requirements for properties you will manage. Surely the owners have at least fire insurance, but having a more comprehensive policy would be a good idea. People who rent vacation homes may cause damage or damage might occur to the renter's belongings if there is water leakage or another problem.

Good point, BizResearcher. Business.gov offers tips for buying business insurance. Message Edited by NicoleD on 01-06-2010 11:09 AM

Can anyone answer the last two questions? Can we be held liable if someone gets hurt on a property that we manage but don't own? Should we carry a separate business policy? I understand that with insurance more is better but finding a balance between coverage, protection and cost is my goal. Thanks for input. Message Edited by mcranston on 01-06-2010 09:02 AM

The answer may lie in how you have worded your rental contract. Does it state that you are not liable for damages, the maintenance of the property, injuries occurring on the property, etc.? You should have two legal contracts - one with the property owners you represent and another with the renters. Your attorney can help you structure contracts that protect you. Message Edited by BizResearcher on 01-06-2010 12:40 PM

As property managers you have an obligation to provide a competent professional service, but there is no specific liability for you to ensure a property has homeowners insurance, unless of course part of your management agreement states that you will manage any necessary insurance arrangements. A standard property management would have any insurance arrangements at the owners discretion, rather than the property managers. You should however have good professional negligence cover in place.

Thanks for all of the great replies! We do have a clause in our contract stating that the owner can't hold the property managers (us in this case) liable for any damages to the property, injuries to guests or anyone else on the premises and legal expenses. Although it says nothing about renters insurance I think this absolves us from any liability.

Yes, we have an agreement to d light maintenance such as changing light bulbs.There is no ambient lighting on any of the properties, just standard overhead illumination and those bulbs are changed ASAP. One place does, however have a wooden deck with some boards coming loose; I'm guessing the owners should be notified in writing about the problem.

Notifying owners in writing when you see a maintenance problem is a good idea. You might even send the letter by registered mail, so you know it was received. That way, should anything happen, you have proof of the owner's knowledge of the problem and that should mitigate your liability. You can assume that if someone is injured because of a structural problem, if they sue they will involve everyone associated with the property, including you.

You should consider buying a business policy that covers lost rents and protects your liability. Many landlords also now require their tenants to purchase renters insurance as part of the lease agreement. It's on average about $15/month so it's relatively affordable. You might get better rates by using rentersinsurance.net to shop and compare several providers. ---This post was edited to remove a commercial link. Read our discussion policies for more Community best practices.