I Don’t Understand this Contract from My Rental Management Company

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“I have a management company for my rental property. This is in their contract. I don’t understand this:

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‘Ower’s Insurance. Owner shall obtain and keep in force adequate insurance against damage and against liability loss, damage or injury to property or persons which might arise out of the occupancy, mamagement, operation or maintenance of the Property. The deductible required under such insurance policies shall be Owner’s expense. Broker shall be named as an additional interset on all liabitily insurance maintained with respect to the Property. Liability insurance shall be in form, substance and amounts to reasonably satisfactory to Broker, but not less than $500,000 (five hunderd thousand dollars). Owner shall provide Broker with proof od fire insurance policies in force and shall obtain adequate vandalism coverage for the Property. Owner shall furnish Broker with a certificate evidencing fire and liability insurance or with duplicate copies of such policies within 15 days after the date of this agreement. Such policies shalll provide that notice of default or cancellation shall be sent to Broker as well as Owner and shall require a minimum of 30 days written notice to Broker before any cancellation of or changes to such policies.’

I don’t understand the part ‘Broker shall be named as an additional interest on all liability insurance maintained.'”

I’m not familiar with that term, either. The one I’ve seen, and would have expected to see there, is “additional insured,” and perhaps this phrase means the same thing in context.

An additional insured is a person (other than the one who purchases the policy) who is treated as being covered by the policy. It’s accomplished by contacting your insurance agent or broker, and obtaining an additional insured endorsement naming the appropriate person.

I would start by asking your management company if what they’re asking for is different from this, and if so, how. Then to your insurance agent to go get what they want.



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Author: House Attorney

A house attorney has answered this question.