Landlord policy if tenant is running a business/Assisted Living Facility

[Globalmax]

Hello everyone...

I have an opportunity to rent my rental home to a tenant who will be running a Assisted living facility. He has all licensing from state DHS, zoning approvals from city to run this etc

What kind of home insurance policy I should look for as a landlord ? Given that it is not a typical residential rental and tenant will be running a commercial business, I am assuming I need a commercial policy as a landlord? Any recommendations for insurance carriers?

 

[Allen Trent]

Hello everyone...

I have an opportunity to rent my rental home to a tenant who will be running a Assisted living facility. He has all licensing from state DHS, zoning approvals from city to run this etc

What kind of home insurance policy I should look for as a landlord ? Given that it is not a typical residential rental and tenant will be running a commercial business, I am assuming I need a commercial policy as a landlord? Any recommendations for insurance carriers?

You will need to likely need to cancel your current Dwelling Package Landlord policy & get a full on Commercial policy specifically covering all the potential risks of that exact type of business being run in the property you own

If you have a loan on the property, the mortgage may prohibit commercial operations. If you have merely a homeowners policy currently & you dont live in the actual house, you currently also dont have any coverage as homeowners insurance requires you to own & occupy the premises

definitely call a local insurance office that specializes in Commercial. It may not be worth you renting to such a business to cover the added costs & likely increase your property taxes & expose the property to greater inspections by the various regulatory agencies that have oversight over such assisted living facilities

 

[fed up]

Make sure any HOA rules are not violated. Also you should look at your charged rent. Wear and tear will be substantially higher ( will your plumbing handle the increased usage?) Get as much liability insurance as you can afford. You are not running the business but will be included in any lawsuit.

 

[marindependent]

The first insurance policy you should look for is from the tenant. Does the tenant have insurance of their own? Many startups struggle to find insurance in the beginning and I would not under any circumstances rent my property to any business that did not carry ample insurance.

 

[Hawaii Agent]

The first insurance policy you should look for is from the tenant. Does the tenant have insurance of their own? Many startups struggle to find insurance in the beginning and I would not under any circumstances rent my property to any business that did not carry ample insurance.

Also be sure to be listed as an Additional Insured on their GL policy and make sure that they carry E&O. Lastly, be sure to speak with an attorney to make sure none of us yahoos are giving you incorrect advice.

 

[adjusterjack]

will be running a Assisted living facility.

So, a start up business, yes?

Well, you can bet on any one or all of the following:

He has no business insurance now or he has inadequate insurance or he has no clue as to what insurance he needs.

Suggestion: Find yourself an independent commercial insurance agent and insist that he accompany you so that you both get the insurance that you both need.

Another issue: Operators of care homes often drive their clients around in their own personal vehicles (commercial auto exposure) and don't tell their personal insurance carriers that they are doing it.

 

[marindependent]

He has no business insurance now or he has inadequate insurance or he has no clue as to what insurance he needs.

Agreed that is why asking them for their insurance before you concern yourself with your setup is often the best course of action.