Eviction insurance

[indogirl]

Someone mentioned eviction insurance,how does that work? Is it good to have?i have a few rental condos in inland empire area.

[paramount]

In general if a property is managed by a property management company, the actual eviction process (and related costs) is typically covered under a standard management contract.

What isn’t covered is lost rental revenue, possible damages to the house, etc…that’s where Eviction Protection Insurance comes in – it covers those expenses so essentially an eviction is no cost to you as the property owner at all.

I pay $15/month for the insurance.

[urbanrealtor]

[quote=paramount]In general if a property is managed by a property management company, the actual eviction process (and related costs) is typically covered under a standard management contract.

What isn’t covered is lost rental revenue, possible damages to the house, etc…that’s where Eviction Protection Insurance comes in – it covers those expenses so essentially an eviction is no cost to you as the property owner at all.

I pay $15/month for the insurance.[/quote]
I am a property manager and I have heard of this but not come across it.
Who carries this that you deal with?

I am very curious.

[indogirl]

Does anybody know if I can purchase this type of insurance without having a property manager? I manage all my rental condos myself.

[henrysd]

I doubt the eviction insurance will help that much. From my Google search, it is small part of the whole package from the property management company itself. It can’t be sold independently.

Most serious and unpredictable costs resulting from eviction is lost rent and property damage which the insurance doesn’t cover at all. The eviction itself is not too much expense relatively speaking. Some eviction services charge as low as $300 plus court filing fee about $260. If you got default judgment without courting hearing, the cost is small. Once go to trial, the cost adds attorney fee which can be another $300. In generally landlord most likely win if tenants fail to pay rent and all the legal steps are done properly.

[paramount]

Typical evictions cost between $800.00 – $1500, most of which is usually paid up-front. In a usual case, the home owner will pay the eviction attorney up front, and often hoping to be later recompensated by refund of the tenant security deposit. However, as frequently is the case, the tenants are already behind on rent prior to filing the eviction, and the security deposit is unlikely to cover all of the lost rent and court expenses. If successful in court, a judgment may be awarded against a tenant for unpaid rents and court costs, but judgments usually do not include everything the owner might have to pay for. For example, such fees that may not be awarded in an eviction judgment include the Sheriff’s Writ (Lockout) fee, Locksmith fees, storage fees, unpaid utility bills, HOA fines, and repair expenses for physical damage to the property found after the tenant is removed. To get additional judgments for further losses such as these, owners must pursue the tenant in small claims court. Frequently, however, homeowners do not follow through with small claims cases, eating the losses and shoulding the burden themselves.

[sdsurfer]

[quote=urbanrealtor][quote=paramount]In general if a property is managed by a property management company, the actual eviction process (and related costs) is typically covered under a standard management contract.

What isn’t covered is lost rental revenue, possible damages to the house, etc…that’s where Eviction Protection Insurance comes in – it covers those expenses so essentially an eviction is no cost to you as the property owner at all.

I pay $15/month for the insurance.[/quote]
I am a property manager and I have heard of this but not come across it.
Who carries this that you deal with?

I am very curious.[/quote]

I think there are insurance companies that offer it, but from my experience dealing with management companies they just work the numbers in a way to benefit themselves and make more money off the owners. They calculate how many homes in their portfolio have an eviction in a given year. Figure out the cost associated then divide it by the number of units managed and offer it to everyone with a little extra for themselves. Some of the ones I’ve come across actually have different levels with different monthly rates for more or less coverage in the instance of an eviction.

Say you manage 100 units and charge $15/month as mentioned above. Of course not all of the owners go for it, but if they did that would be 18k a year and would probably cover a couple months of vacancy or a couple tall cans of Coors. Not that all property managers drink Coors…that’s probably just me.

[Anonymous]

There are two new programs that offer legal cost protection (evication fees) as well as loss of rents and other turnover expense coverage. These are insurance programs and not loss funds.

For 1-200 units, you can look to http://www.aonrentprotect.com

For 200 or more units, you can look to http://www.leaseterminsurance.com. Lease term also offers Legal Liability insurance and a number of additional program.

Under both programs you can be the owner or manager of the units.

[Author]

Posts