What’s at Risk with Vendors who Work on Your Property?

Ensuring proper coverage on multifamily properties has taken on new meaning in the last decade, just as it has everywhere else. The days of management companies viewing insurance protection with a check-box mentality are waning because more sophisticated coverages are necessary to provide a large enough shield to protect properties throughout the nuances of day-to-day operations. Today, risk managers must think beyond a general liability policy or umbrella coverage when vendors come onto the property to perform the multitude of tasks that keep properties running. Basic coverage once considered adequate typically doesn’t cover the unique exposures that come from working with service providers. For instance, when a towing company rolls out of the parking lot with an unauthorized vehicle, the risk to the property follows. The service may have a policy that covers general liability on the property but it may not protect the vehicle or have a high enough limit for damage caused on the way to storage. If the vehicle is damaged in transit, the owner likely will first seek recourse against the apartment community. Another example is the risk associated with the use of consultants. Apartment managers will most likely need to rely on a professional liability policy rather than general liability coverage for most claim related items.   The devil has never been more in the detail, which is pushing the need for risk managers to cover the bases better than they did several years ago, says RealPage Vice President of Vendor Credentialing, Tracy Castleman.  “What’s changing, is the way that people are tracking insurance,” said Castleman, a licensed risk manager and property and casualty adjuster who has managed vendor programs for the real estate industry for the past 14 years. “Focusing on the basic policy types such as general liability, auto liability and workers’ compensation is no longer enough. As property managers, we n...