Where To Find the Best Insurance for Apartment Buildings

As an apartment building owner or manager, you know that there are a lot of things to keep track of—from maintenance and repairs to rent collection and lease agreements. 

One of the most important things on your list should be finding the right insurance for your property. With so many options, it can be tough to know where to start.

Don't worry - we’re here to help you make sense of things. This blog post will give you tips on finding the best insurance for your apartment building and share some things to keep in mind as you compare policies. So read on, and rest assured, knowing that you're well on your way to finding the right coverage for your property.

Looking to protect yourself and your investment? Get an instant quote from Obie today. No paper applications, week-long waits for quotes, or back and forth with brokers.

How To Find The Best Insurance for an Apartment Building

Having good insurance coverage is important. But it can be hard to choose the right policy. This is especially true when you are dealing with apartments because there are so many things that could go wrong.

It helps to have a list of requirements and minimum coverage an insurer should provide. Here are some of the questions to ask when purchasing insurance for an apartment building:

• Is the coverage named or special form?
• Does the policy cover additional structures, e.g., fences, pool houses, landscaping, mailbox clusters, parking, and gates?
• What are liability coverage limits?
• Does your liability insurance include discrimination coverage? 
• What is your deductible, and how can you get the best value?
• What is the extent of loss of use—the period covered and the amount?
• Will a future claim be paid in actual value or replacement cost—given that replacement value cost is usually the best option as it does not factor in depreciation?
• Can you get blanket coverage for multiple properties?
• Availability of law and ordinance
• Available riders and costs—for example, sewer backup, flood, and earth movement coverages.
• If you have employees, what's the level of workers' compensation?  
• How about contractors, property managers, and other vendors, like landscapers? Are they covered under your policy? And do they need to meet specific requirements?
• What is the insurance company's history in handling and honoring claims?

Best Apartment Building Insurance Providers

There are many insurance providers to choose from, but not all will be a good fit for apartment building owners. You need to research and find a provider who caters to your specific needs. Sometimes it can be helpful to work with an online insurance broker like Obie to compare different providers and find the best one for you. (If you own an apartment building with 20 or more units, be sure to check out Obie's private client service.)

However, if you prefer to do your own shopping for insurance, here are a few of the best apartment building insurance providers to consider, according to Fit Small Business.

Chubb Insurance

Chubb insurance is one of the largest insurance companies. It is traded publicly and has a Superior (A++) A.M. Best rating. Chubb provides property and casualty insurance to individuals and companies of all sizes. 

It offers various insurance products, from commercial property insurance to workers' compensation and umbrella policies. In addition, it allows you to fill in your details online for an instant quote customized to your needs.

Farmers Insurance

Founded in 2012, Farmers Insurance Group has an A Rating from A.M. Best. It has made a name in the industry as a provider of coverage for homes, vehicles, and small businesses. However, it is widely known for its commercial property coverage wrapped in a Business Owner's Policy. 

Its online portal is quite helpful as it allows you to make claims. It also includes educational resources with a wide variety of information to ensure you are well-educated on all insurance matters.

State Farm Insurance

State Farm Insurance provides various insurance products, including customizable coverage for apartment building owners. Generally, its policy for apartment owners includes coverage against fire, tenant misuse, liability lawsuits, and destruction by natural disasters. 

It also has additional policies you can add as riders, including laws or ordinances. Most notable, though, is its online portal that allows you to enter your zip code and connects you to agents in your location. It also has an A++ A.M. Best rating.

Travelers Inc.

The Travelers Companies, or in short, Travelers Inc., is among the largest insurance providers in the country with an A++ A.M. Best rating. It offers landlord insurance for rental property owners with 1 to 4 units. 

This makes it an ideal provider if you own a duplex, triplex, or fourplex apartment building. Besides covering the property's primary and additional structures, it also covers the landlord's contents, liability, and loss of use.

FAQs

What insurance do I need for my apartment building?

There are several insurance types available for apartment buildings:

• Commercial property insurance - is available for commercial properties, including apartment buildings with multi-stories. Or if you have multiple properties. It mostly comes in the form of named peril, covering the property against risks like fire, smoke, explosions, riots, and vandalism. It covers more than its primary structure. The coverage extends to other structures, like the fence, storage, and swimming pool. Most insurers will also allow riders for other events, like flood coverage.
• Business income insurance - this is also referred to as business interruption insurance or loss of use insurance. It provides rental income reimbursements if anything happens to your property or the tenants.
• General liability insurance - will protect you against financial damages from lawsuits. It covers medical and legal costs if someone is injured on your property and you are found negligent. Some insurers will even damage by discrimination lawsuits.
• Business owner's policy - is designed for small businesses and would be ideal if you have a small apartment building, e.g., a duplex, triplex, or fourplex. A BOP provides coverage for the property, general liability, and business interruption. Most policies will, however, not include endorsements for perils like earth movement and flood. In addition, a BOP will also exclude professional liability and workers' compensation.
• Umbrella Insurance - is additional coverage that kicks in when you exhaust the limits of your liability policy. In a litigious society, there is no telling what could land you in trouble. Maybe a tenant's guest fell off the staircase and sued you for negligence. Or you are accused of discriminating against or evicting a tenant illegally. Whichever the case, it helps to have extra protection against liability charges.
• Law and ordinance insurance - if you were to rebuild or repair your apartment buildings at an extra cost to comply with current building costs, this coverage reimburses you. Law and ordinance coverage is usually added as a rider to your commercial property insurance. While it comes at an additional cost, it is an important endorsement if you have an old apartment building.

How much insurance do I need for my apartment building?

Like any insurance policy, the cost of your apartment building will depend on several factors. These include:  

• Location of the property
• Building age
• Condition of the apartment building
• Number of units the apartment building has - the more units, the higher your insurance cost
• Types of construction materials used on the property
• Property's security features - steps taken to make the property secure, e.g., installing security cameras, could lower your insurance cost
• Level coverage you choose - endorsements to your policy add up the cost of insuring your property
• What about coinsurance penalties? Are they waived?

Besides these, carriers set different prices, so the insurance company you choose for your coverage matters. The best way to ensure you have the best coverage at a reasonable cost is to work with an insurance broker who can shop and compare different carriers on your behalf.

What does insurance cover for my apartment building?

The insurance coverage for your apartment building will depend on the risks involved. For example, is your building located in an area that is at risk for natural disasters, like hurricanes and tornadoes? Or is the area known for having high levels of violence, which could lead to vandalism or burglary? Your apartment's insurance should cover property, rent loss, and liability damages.

Is there anything else I need to know about insurance for my apartment building?

Besides the covered perils and standard deductibles, you also need to know if you have other deductibles. For example, wind and hail, flood, and earth movement policies attract separate deductibles. Knowing what your deductible is can help you plan accordingly. 

How can I get the best price on insurance for my apartment building?

Although insurance costs for apartment buildings can be costly, you can still get the best price. One of the best ways to achieve this is to compare quotes from several providers. Every provider has its pricing strategy and perils covered. Sampling the market allows you to compare and contrast.

However, this can be an overwhelming task. That's why it is advisable to work with an online insurance broker like Obie. Obie can help you find the best insurance for your needs and will make the process much easier. They have experience with different carriers and can quickly source the best providers to insure an apartment building. More than $4 Billion in property is insured with Obie, and coverage is available in all 50 states.

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