Navigating an insurance policy can seem daunting. At Top Floor Insurance, our goal is to simplify the insurance process and make apartment community insurance easy to understand. We’re breaking down three of the top insurance terms you must know to be sure you’re getting the right coverage, for the right price.

General Liability Insurance

General liability covers two main items: bodily injury and property damage being caused by operations.

If your building burns down and in the process destroys homes in the neighborhood next to your apartment community, then the homeowners can file a claim against your property for damages related to the fire. This is why having liability insurance is key!

But, property damage is just one aspect of general liability. The main focus for apartment owners when it comes to general liability is bodily injury.

When evaluating an insurance policy, there is a standard liability proposal. There are general liability coverages that all insurance providers offer that are about the same. What is different are the exclusions – and they’re important to understand.

There are three big ones you DO NOT want to have in your insurance policy.

1. Assault and battery
2. Abuse and molestation
3. Punitive damages

To read more about these exclusions, and why you don’t want them on your policy, download our complimentary white paper, click here.

Umbrella Insurance (Excess liability insurance)

This is great coverage to have as it takes the liability limit beyond $1 million per claim. The good news is you can increase the limit as much as you want.

There is no definitive answer to how much umbrella coverage you should have. At Top Floor Insurance, we recommend that you look at the liability insurance you have to cover your property in terms of the cash value for each property you own.

Always consider the ratio of your property’s value to the amount of liability insurance you have.

However, there is no magic ratio. We generally recommend for an individual apartment community to carry at least $5 million in insurance liability.

Builder’s Risk Insurance

This is important when you are building an apartment community or doing major renovations. Apartment community owners often make major mistakes with this, by letting the contractor buy the builder’s risk policy.

When the contractor gets the builder’s risk insurance, they are the owners of the policy, not you. Which means, if they file a claim, they get the money and you have to negotiate to get it from them.

For any project there are several costs to consider, especially when determining how much builder’s risk insurance to get. When you let the contractor negotiate the terms of the builder’s risk insurance, the costs to you are generally always left out.

These are just a few of the top insurance terms to know. There are a host of other important insurance terms and clauses you should be aware of. For more information, visit our video library for quick 3-minute explanatory videos to keep you informed.

At Top Floor Insurance, we can work with you to get the right coverage for your apartment community, no matter the size. We specialize in multi-family property insurance, so you get the best coverage, for the best price. We are the apartment community insurance experts because that’s all we do. Period. If you ever need a fast apartment insurance quote or would like a leading insurance specialist to review your current policy, give us a call at 404-266-3218.