Are Your Investment Properties Sufficiently Insured?
Some of the insurance claims made by property investors over the last year have made insurance companies speechless and the situation warrants that investors (who are also landlords) pay great emphasis on the shape of their property at the time it is vacated by the previous tenant.
Weird insurance claims coming up
An incident that can send shiver down landlord’s spine- a tenant left the taps running and the situation prevailed for a month before eventually being noticed. As a result, the whole home was irredeemably taken by moulds.
Case in point: Tenants using homes as drug laboratories
It is not new to us that some of our investment homes are turned into esoteric drug laboratories by tenants who hadn’t been screened too well by you or your property manager. Claims for forensic cleanups have been flying thick and fast and are enough evidence of the drug dens in our homes.
Hire a property management firm
Perhaps the only way out of the puzzle is to hire the services of a property manager or a firm that keeps inspecting the properties every so often. This can put an end to homes falling into absurd physical situations but then property management is usually followed by only those with a decent investment portfolio.
Tenant screening is a prerequisite
You can’t possibly hire a firm and pay them each month if all you have got is a couple of properties. In such cases, you will have to be doubly diligent about the screening of tenants (their complete background verification and present financial soundness) and inspection of properties.
In the light of weird claims made in the recent past it might also be wise to check with the endorsements and exclusions of your insurance policy.
What method do you employ to screen tenants?