As a property owner who self-manages residential property in El Monte, CA, it’s essential to understand the need for property management Errors & Omissions insurance.
This type of liability insurance protects you from potential financial damages and legal defense costs resulting from errors or omissions in your duties as a self-managed landlord.
With so many responsibilities, busy property owners who self-manage are susceptible to making mistakes. Maybe you unknowingly ask an inappropriate question during tenant screening or have an illegal clause in your lease agreement.
Property management E&O coverage can help pay for your legal defense costs and any settlements awarded if a tenant sues you for damages caused by negligence or alleged discrimination.
Here are some key points you need to know about E&O coverage for self-managed properties in El Monte, CA.
What Is Property Management E&O Coverage?
Property management E&O insurance protects self-managing property owners against claims alleging errors, omissions, or negligence in performing their duties.
As a self-managed landlord, you must deal with tenant complaints, hire contractors, finalize leases, collect rent, screen tenants, list properties, and make sure your property stays up to code.
With so many responsibilities and legalities, it can be easy to overlook a key detail or get stuck with a bad contractor who performs negligent work.
Why Do I Need Property Management E&O Coverage?
If a tenant files a claim against you, property management E&O coverage will provide you with the financial protection you need. This type of coverage would help to cover the cost of legal fees, settlement costs, and any other related expenses.
Without this coverage, you could be facing significant financial hardships if a tenant were to sue you successfully. As a result, property management E&O coverage and risk management are essential for any El Monte property owner who self-manages.
What Does Property Management E&O Coverage Cover?
Property management E&O coverage typically covers the costs of defending against a claim and any damages awarded if a judge finds you liable.
E&O coverage for property managers typically includes protection for claims arising from:
- Breach of contract
- Violation of Fair Housing laws
- Failure to maintain the property
- Invasion of privacy
- Wrongful eviction
- Property damage
- Bodily injury
How Much Does Property Management E&O Coverage Cost?
While the cost of errors and omissions coverage will vary depending on factors such as the size and location of your properties and the amount of coverage you need, it is generally very affordable. It can often be just a few dollars a month per unit.
Therefore, if you self-manage a property you own, it is well worth your while to purchase E&O liability insurance. It could potentially save you a lot of money and stress in the long run.
When Do I Need Property Management E&O Coverage?
Mistakes can happen anytime. Especially when you’re a new landlord. Fair Housing laws can be complicated and it can be easy to overstep your bounds when trying to protect your property from a bad tenant.
This type of liability insurance is an indispensable part of risk management for any landlord. It’s better to be safe than sorry, and E&O insurance will give you peace of mind because you are protected if something goes wrong.
What Is Required to Carry E&O Coverage?
E&O insurance has typically been difficult to obtain for self-managed properties but it is becoming more common and more affordable. But, it’s important to remember that coverage must be purchased for each individual unit.
Each Errors and Omissions insurance provider has its own stipulations and often has strict limits on how much they cover. It’s important to read the fine print and consult with both the insurance company and your lawyer to go over the language in the policy.
Reduce Owner’s Liability with Lotus Property Services
Beyond E&O coverage for self-managed properties in the El Monte area, there’s another way to minimize your risk of being sued for making a mistake.
When you trust Lotus Property Services to handle all the day-to-day operations of your investment properties, you’ll get the protection of expert El Monte property managers who know how to navigate all the legalities of writing leases, tenant screening, hiring contractors, the eviction process, keeping up with laws and regulations, and handling tenant issues.
On top of that, our comprehensive property management services will make sure you get paid on time, ensure you only get high-quality tenants, relieve you of stress and worry, and help you maximize the revenue from your rental property in El Monte, CA.
Already have a property management company or thinking about hiring one? Check out this blog on how to find a great property manager in the Greater Los Angeles area, including El Monte.