The Top Three Insurance Resolutions for Property Managers in 2017

Jan 27, 2017

The Top Three Insurance Resolutions for Property Managers in 2017

By Caesar Mistretta, Vice President, New Business Development, HUB International Northeast and Guy Gioino, Senior Vice President &  Risk Services Leader, HUB International East Region

For many of us, the new year is a time to reflect and make a resolution to accomplish new goals and fix what we don’t like. Whether it is personal or professional, there is always room for improvement and change.Starting fresh and taking action to proactively implement the business measures outlined below will help you reduce insurance costs, prevent unnecessary claims and will assist overall at the time of your renewal. 

1) Review Your Building Characteristics to Ensure Accuracy in Property  Insurance Limits and Coverage:

Do you know what it would cost to rebuild your building in case of a loss?  Are you comfortable with the insurance limits and terms/conditions of your property policy? Costs to rebuild and replace can fluctuate and based on geography or improvements you’ve recently made, may have gone up significantly in recent years. Your insurance advisor should be providing you with an estimated valuation of your property and compare it to your policy limits and coverage, at least annually. Other significant factors that must be verified are construction type, occupancy, protection and exposure, commonly known as “C.O.P.E”. 

Ratings can be affected significantly (both for being over insured and in many instances, underinsured), if any of the following elements are inaccurate:

  • ·         gross square footage,
  • ·         building upgrades and repairs (i.e. HVAC, roof, façade, windows etc.),
  • ·         incorrect rating on construction type (i.e. frame vs. masonry non-combustible),
  • ·         flood zones.

 In addition, if your building is historic or contains high value amenities and irreplaceable features, a standard building valuation may not be enough to ensure the total value is covered. You must contact a reputable building appraisal company to account for these values. 

If your building is very old and not currently built to code (but was grandfathered in), it’s important that you consider Ordinance or Law coverage. If your building were to sustain a total loss, it would now be required to be built to code; therefore, you will want to make sure that any additional costs associated with doing so are covered by your policy.

Being underinsured can also cause your insurance carrier to levy co-insurance penalties for claims so it’s important to address this issue and confirm that everything is adequate in advance. 

2) Don’t Pay For Someone Else’s Mistakes, Review All Vendor Contracts:

Common causes of third party liability losses can be traced back to inadequate contracts signed by property managers with their vendors.  Even with legal counsel involvement, it is common to miss the fine print in the insurance language that ties the two parties together.  Your insurance advisor should be reviewing your vendor contracts to ensure that your liability is contractually transferred to the hired vendor for damages they cause. 

Securing a vendor’s certificate of insurance is usually not enough since it’s not considered evidence of coverage. In addition, a vendor may be issued a cancellation while they are performing work at your property.  It’s important to have an indemnification and hold harmless agreement, and for higher risk projects, be named as an ‘additional insured’ on your vendor policy so that you are protected by their coverage. 

Your insurance advisor should also be verifying coverage for any exclusions for certain types of work, adequate limits for coverage, and assisting in qualifying the vendor when necessary 

3) Review Your Overall Property Safety:

As a property manager, demonstrating that you are committed to the safety of your premises, unit owners and tenants is highly recommended in a number of ways. Having a system to document inspections to identify hazards for items such as fire, emergency response, slips and falls, snow/ice removal, playgrounds, clubhouses, etc. can prevent an injury or property loss from happening.  An inspection checklist can also help your insurance advisor and carrier in potentially defending a claim caused by a plaintiff, where the property has taken reasonable actions to mitigate risks. In addition, having a formalized safety/risk management plan is viewed very favorably by insurance carriers in terms of premium pricing. Your insurance advisor’s risk consultants and claim advocates are valued partners in helping you prevent claims, and when they do occur, contain the severity.

Proactivity is Key: The beginning of the year is the best time for property managers to tackle these suggestions as it allows them to have ample time to identify, correct and implement enough procedures to make an actual difference with your insurance carriers at time of renewal. Most importantly, work with an insurance advisor that can walk you through these processes and make sure that you are adequately protected and presented in the best possible light to insurers.

About the Authors:

Caesar Mistretta currently serves as Vice President of New Business Development with HUB International Northeast, a leading global insurance brokerage serving the Real Estate industry for over 60 years. Caesar can be reached by phone at 484-344-4405 or at

Guy Gioino, CSP, ARM, CHMM, ABCP currently serves as Senior Vice President and Regional Risk Services Leader for HUB International’s East Region. Guy holds two decades of experience in risk assessment/control and specializes in environmental and construction risk exposures. Guy can be reached by phone at 908-​790-6868 or at

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Gioino                           Mistretta


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