Are You Prepared For Winter Maintenance Emergencies?

Winter is a stressful month for rental property owners. When the weather freezes, they must occasionally spring into action, dealing with weather-related emergencies like frozen or burst pipes, broken heaters and furnaces, and iced-over driveways and sidewalks. Now’s the time for rental property owners affected by sub-freezing temperatures to figure out how to handle these maintenance emergencies.

Make sure you're ready to handle maintenance emergencies this winter!If you haven’t done so already, have insulation, plumbing, roofing and HVAC/furnace units inspected and serviced. You’ll want to get this taken care of before the next blizzard or ice storm hits your area. You may still be able to take proactive measures if the inspection shows a problem.

If you wait until the ice storms come, you’ll have problems scheduling plumbers and other contractors to do maintenance work, even if you need it in a hurry. They’ll be busy responding to other emergencies!

Educate Your Tenants

Reach out to your tenants and tell them what you need from them. Provide them with things to look out for, such as warning signs of furnace, heating or plumbing problems, along with exactly what you want them to do in the event things go wrong.

Republish your emergency maintenance requests numbers, both for regular business hours and for after hours.

Check on Your Vendors

Now’s a good time to inspect your existing contracts with the vendors you may need in an emergency. Make sure you have any retainer arrangements in place so you aren’t forced to negotiate prices during a crisis. You won’t get the same advantageous pricing when water is pouring into the basement as you will when you’re prearranging your emergency plumbing responses! The same goes for HVAC contractors, roofers and other contractors you may need to call in at short notice.

Check on Insurance Coverage

Naturally, you will want to ensure that coverage for your rental properties is in place and adequate, together with reserves, to cover any weather-related issues.

It’s particularly important to understand the insurance concept of fair market value versus replacement cost coverage. Many insurance companies issue policies that cover fair market value of, say, a new roof. Fair market value, however, falls over time through depreciation. So if the roof incurs significant structural damage because of the weight of snow and ice, for example, a fair market value policy would not cover the entire cost of replacement. The older the roof, the less the insurance company will pay.

This is fine, if you have been regularly setting money aside to replace the roof at the end of its useful life. Between the insurance company and the savings, the capital should be there to replace the roof.

In the real world, though, rental property owners are often blindsided by unexpectedly low settlements on insurance policies. This catches them in a cash flow crunch when they need to replace a roof on short notice with an insurance check that only covers a fraction of the immediate need.

Keep Your Tenants Happy and Rentals in Good Shape

This will hopefully be a mild winter with no major blizzard events that cause major damage and disruption to the communities your rental properties are located in. But by reaching out to your tenants ahead of time and being proactive rather than reactive, you can ensure your tenants are kept happy and your rental properties remain in good shape.

Neutralize Fires This Winter Before They Occur

‘Tis the season. Not just for holiday cheer and giving, but also for cooking fires at holiday parties, exposed candles, fireplace sparks, space heaters near flammable drapes, and Christmas lights overloading extension cords.

How to prevent house fires from devastating your homeowner or condo association this winterThere were about 98,000 reported apartment fires in 2013, which killed at least 325 people that year and injured about 3,900 more, according to data from the National Fire Prevention Association.

Heaters and fireplaces are responsible for about 27 percent of residential fires. That means that winter is a critical time when it comes to fire prevention outreach and education. Peak heating fire season runs from December through February.

The National Fire Prevention Association estimates that about 900 fires every year are attributable specifically to Christmas decorations, menorahs and other holiday items catching fire.

So what can your homeowner or condo association can do to neutralize the fire threat before it occurs? Here are some tips:

Get a Courtesy Inspection

Contact your local fire department or fire marshal. They will generally come to your property for free or for a minimal fee and walk you through common areas, facilities, storage areas and other critical locations to help you spot potential hazards. This could include electrical and wiring problems, hazardous material storage, and landscaping or trash management problems that might contribute to a spreading fire. They will also spot access problems that could prevent evacuation or keep firefighters from reaching a fire on the property.

Generally, you won’t get fined for code violations or other issues discovered during a courtesy inspection that you request, provided you correct them within a reasonable time.

Send and Post Newsletters

You can create newsletters for your residents and mail them, slip them under the door, or post them on bulletin boards in common areas. The National Fire Prevention Association also has a number of fliers and posters available for download. Topics include:

  • Cooking safety
  • Candle safety
  • Heating
  • Smoking
  • Electrical safety
  • Dryers
  • Microwaves
  • Wood and pellet stoves
  • Fireworks
  • Grilling and cookouts

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Have a Community Meeting

As you can see from the list above, there is no shortage of topics you could cover at a community fire-awareness workshop. Be prepared to buy some pizzas for residents or hold a drawing – you want to maximize attendance at an event like this. If your turnout is good, your community will be more aware of fire safety issues, and more likely to protect your property. Your property management and janitorial staff can’t do everything by themselves, and they can’t do much about hazards in the dwellings themselves. You need your residents to do that.

Larger properties may be able to get a presence from their local fire department as well. You could even make a kid-friendly event out of it with a little imagination.

Other Fire Prevention Tips

  1. Service furnaces and HVAC units now.
  1. Take a good look at your laundry rooms. Lint buildup in hoses is a frequent potential hazard. Check for clothes piling up behind the dryers. And make sure your wiring can handle the appliances.
  1. Get residents to tell management any time a breaker in a property trips. Even if your community isn’t a condo or high-rise, if all the single-family homes are similar, they probably have similar wiring. Tripped breakers can alert others to potential wiring problems.
  1. Have your fire extinguishers inspected and charged. Put this task on your regular maintenance schedule.
  1. Ensure electric appliances are nowhere near pools and Jacuzzi areas.
  1. Insist renters carry renters insurance. A simple kitchen fire could cost more than a renter is able to cover out of his or her own financial resources.
  1. Clear parking lots, driveways and access areas of dumpsters, debris and parked cars. This ensures that fire trucks can access the back and sides of each building as necessary. Be vigilant in enforcing parking rules to facilitate this.
  1. Conduct drills. At a minimum, every staffer and community leader should be able to brief the fire plan, which includes demonstrating familiarity with electrical, water and gas shut-off points; elevator shut-off points; and fire hydrant locations in case they have to guide firefighters to them.
  1. Inspect all smoke detectors, sprinklers and carbon monoxide monitors. Be cognizant of access notification requirements before you enter dwellings.
  1. Tell residents to make sure their Christmas trees are fresh and green. Dry trees are much more flammable than green ones. Also, keep the trees away from radiators and space heaters. Set up a tree pickup service after the holidays. And for Hanukkah, keep drapes tied well away from any window menorahs.

9 Essential Insurance Policies Landlords Should Consider

Essential forms of insurance that landlords need - from fire to flood to windstorm insuranceInsurance protects against risks rental property owners cannot afford to incur. Individual landlords typically cannot bear the cost of the total destruction of a rental property out of pocket, nor can they typically withstand a judgment for $1 million or more in the event someone is hurt or killed on their property.

But no single insurance policy can take care of every risk a landlord faces. The art of risk management is combining multiple insurance plans from different vendors to create a meaningful safety net for a wide variety of potential risks.

Here are the most important forms of coverage that just about any rental property owner needs:

Landlords Insurance

Don’t rent out a property without it. Some landlords make the mistake of buying a home, getting standard homeowners insurance coverage, and thinking that will do the trick. It won’t.

Homeowners insurance only protects the resident owner and his or her family. It does not protect tenants, and in the event a tenant is injured or harmed on the property, it will not pay benefits. The tenant will not have an insurance company to pay hospital bills or take care of other damages. They will have no recourse but to sue you, the landlord, to compensate them for whatever transpired on your property – and they will likely get a judgment against you. Without insurance in place, you run the risk of having assets seized or being forced to declare bankruptcy. The risk is potentially devastating, both to you and to the tenant.

For the best coverage, look for policies that cover “all risks” and provide protection in the event of loss of rental income. This is vital if you rely on the rent you receive for income or to keep up the property insurance and tax payments on your investment property.

Flood Insurance

Some people assume that damage from floods is covered under a homeowners or landlords insurance policy. That’s only true for flooding caused by something like an exploding pipe. If the flood happens because of a rainstorm, flash flood or a river jumping its banks, you will be out of luck – unless you have flood insurance.

Flood insurance has two components: structure and contents. Coverage is limited for basements and other areas below ground.

Normally, landlords purchase flood insurance from their usual property and casualty insurance agent via the National Flood Insurance Program.

You don’t have to own flood insurance. You are free to “go naked,” if you like, but if you carry a mortgage on the property, or plan on cashing out some equity, expect mortgage companies to require it before they will finance a loan on the property.

Windstorm Insurance

This is extremely important in coastal areas that are subject to hurricanes or other tropical storm risk. Standard, off-the-shelf homeowners and landlords insurance don’t cover this risk. To protect yourself, you’ll need to buy it separately.

Most coastal areas have state-sponsored programs that provide a backstop to limit insurers’ losses in the event of a major storm. They do this to ensure that there is a market, and that insurance carriers compete for it.

Speak with your insurance professional for specific information.

Get the most out of your rental properties – have a professional property manager be your rent collector, maintenance mogul and conflict resolver >>

Vacant Property Insurance

Is the home sitting unoccupied between tenants for more than 60 days? If so, your property may have an elevated risk of damage from vandalism, vagrancy, squatting, flooding or mold. Unless you can arrange for a short-term house sitter, you may need to get special vacant property insurance in place.

Fire Insurance

This coverage provides the cost of repairing or rebuilding structures damaged or destroyed by fire and their contents. A fire insurance policy will typically have four components: dwelling, other structures, loss of use, and personal property. However, your tenant should be responsible for his or her own property in most cases – likely by obtaining a renter’s policy.

Many fire insurance policies also protect you in the event a fire on your property spreads and causes damage to others. You will probably want to get this coverage, especially if your property is in an area at elevated risk of wildfires.

Earthquake Insurance

Again, this is a specialized and location-specific risk, for the most part. Standard homeowners and landlord insurance won’t cover you.

Sinkhole Insurance

Sinkholes are a major issue in parts of Florida. They are also occasionally seen in places like Tennessee, Kentucky, Ohio, Michigan and Pennsylvania. Basic landlord and homeowner policies don’t cover this hazard. You need to obtain separate coverage, or purchase a rider.

Personal Umbrella Policy (PUP)

This inexpensive and vital form of insurance coverage steps in when your basic insurance policies have paid out their maximums. You can get a lot of protection against a wide variety of potential hazards for very little money in premiums.

Commercial Umbrella Insurance

Do you rent out more than four properties? Congratulations. You are no longer a “small landlord” for the purposes of insurance underwriting! When the number of properties you own rises above five, most carriers consider you to be a small commercial enterprise. You’ll need to get special commercial umbrella insurance coverage.

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