Liability for Property Flippers - Does Coverage Exist???

[JimmiDrums]

Looking for some guidance here. I help many property investors with coverage for their flip projects, but I have a new request from a client that I am struggling with. My client is looking for liability protection in the event they are sued sometime in the future due to issues with the property/home they flipped. Kind of like the tail coverage that a general contractor would carry to protect against defects. Here are some of the facts:
-operations are in California
-looking for liability protection that would extend well after the flippers property policy is cancelled.
-client is not a general contractor and does not do the work themselves. They hire or subcontract the work out.

I have spoke to multiple underwriters and they have yet to offer a solution. Any help would be greatly appreciated. Thanks!

 

[KenP]

Hopping in here to see the replies, too. I've done primarily personal lines, including builder's risk policies, so I've helped with your standard fix n flip BR type policies. This sounds like something along the lines of an occurrence policy with coverage for completed products and operations. If your underwriters have trouble placing it, not sure where you'd go next. Everyone seems so apprehensive of anything in the construction trade as it is. Best of luck

 

[AZDave]

Your client uses an insured general contractor: have your client draft a subcontract agreement for the project. The indemnification section needs have the insurance requirements set - one of them being that gc adds client as additional insured for both ongoing (cg 2033) and completed operations (cg 2037). He will need to require that the completed endorsement remain on gc's policy for a period of 'x' number of years. If a claim arises, client can then place the claim with the gc's carrier directly.

Your client should also have all properties titled in an LLC for additional protection.

Just a thought....