Property preservation is often referred to as ‘mortgage field service’. As a property preservation or mortgage field services contractor, you have the important task of preventing buildings from falling into disrepair. Property Preservation is a vital service for any community because it protects surrounding home values and safeguards important assets for local financial institutions. Whether you're cleaning up or repairing a foreclosed home or remodeling a home to restore its historic value, you must protect your business.
Why Do You Need Property Preservation Insurance?
Engaging in property preservation can be a lucrative opportunity, and having the correct type of coverage can be one of the deciding factors in your success. Transparency about current practices and future goals will help ensure that your insurance policy covers your risks and sets you up as a professional worthy of consideration for contracts.
What Types of Policies Should You Consider?
What are the basic policies you need?
General Liability Insurance
Many—if not most—Real estate owned asset management companies and banks may require proof of general liability before they’ll work with you. General liability typically includes personal injury and advertising injury protection, third party bodily injury protection, and third party property damage.
Also referred to as 'Errors and Omissions". If you don’t already have this coverage, most REO companies or banks will give you 30 to 60 days from the beginning of your contract to obtain the policy. Errors and omissions should cover you for work including trash-outs, removing and securing contents of vacant property, minor repair, maintenance work, winterization when applicable, lawn care, and changing locks. If property preservationists make any professional errors, this policy helps cover legal expenses in case of lawsuits.
Additionally, workers' compensation is also a must-have coverage if you hire employees. While it isn’t required if you hire subcontractors or independent contractors, you should certainly consider the protection in case an on-the-job accident occurs that injures a contractor. Some insurance companies offer "pay as you go" workers' compensation policies, where your workers' compensation premiums are calculated using your actual payroll numbers rather than a fixed or estimated number of insured people.
Other Policies to Consider
There are some other policies you may want to consider as part of your personal coverage, including commercial auto, unemployment benefits, and health insurance. Necessary policies may often be determined by the specific services you provide. Be sure to check with your state and local city to find out if they have any requirements.
Property Preservation Insurance Cost
An average cost for general liability is around $800 annually. Certain factors—such as the services you provide—will impact that cost. Talk to a licensed and experienced agent to get a more accurate and affordable quote.
Information Needed to Obtain a FREE Quote
Determining the necessary coverage levels requires asking about your usual or expected practices and the services you offer. Even if you don’t offer particular services at this point in your business, if it’s a future prospect or something you’d like to eventually do, having insurance that covers you for that pursuit could be the help you need in getting those jobs. Here are some basic topics that an agent may ask about to help determine what type of property preservation business you have and how to protect it:
- Lock changes: Securing properties is not always a feature of property preservation. Getting adequate coverage in your policy means understanding all of your exposures.
- Winterization: In certain climates, winterization services are a requirement. Vacant properties need special attention when temperatures drop. If a point is missed, damages could arise—you want to be sure your policy addresses all your practices and covers your liabilities.
- Debris Removal Services: Debris removal is sometimes referred to as a “trash-out”. This could be as simple as removing property left behind by tenants, or disposing of materials after a rehab or renovation. Whatever the circumstances, inform your agent of the type of debris removal you do.
- Real Estate Owned (REO) Maintenance: Whether you own a small operation that contracts through a larger property preservation organization, or you are that larger entity that specializes in handling foreclosed properties, your policy will likely need to meet certain requirements. Specifics from all parties involved are necessary, as well as full disclosure of your operations.
Let us help you find protection for your business and keep your mind at ease. At CommercialInsurance.Net, our goal is to get you an affordable commercial insurance quote, whether it's simply general liability, errors and omissions, or something more extensive. To get a competitive quote is fast and easy, enter your zip code and click “Get Quote.” One of our specialists will contact you soon.Call us at 1-877-907-5267 to speak with a professional who can guide you to the right coverages for your needs.
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