Question About CGL for Property Management Company in CA.

[Jerbond]

O.k. I have a client that has (5) rental houses. All are deeded in in the company name. Husband and wife are owners. All properties are DP-3 covered with $300K OL&T liability. I am recommending a CGL policy- typical $1M- $2M aggregate. Policy through surplus lines for a stand alone CGL is $850. Obviously the customer is not interested in spending any additional insurance coverage. What is my best reason for them to go this route? I told them about wrongul evictions, but not sure what other "perils" would
necessitate this additional coverage. I know this is the right direction to go, but having a hard time getting them to pull the trigger. Please provide some feedback. Thanks.

 

[Air Jer]

I will most likely get shot down and I hope I do as it's a good way to learn. With that said, I see no reason why they would need a CGL. They have no products or comp ops exposure but they do have an OL & T exposure and I'd sell higher limits. $300,000 is nothing in today's legal environment.
However, another thought just popped into my head & I will contradict what I just wrote - with a CGL, you could at least get an "aggregate per location" endorsement and that would be very worthwhile.

 

[Bertolinoins]

Why couldn't you just place the 5 properties with a carrier that has a good landlord package policy including coverage personal injury, wrongful eviction, or wrongful entry as well as other non-bodily injury claims such as libel and slander?

If they manage properties for other they need an E&O policy but if it is just their own properties... why couldn't you place them with a standard carrier like Mercury, CIG or Safeco?

 

[Jerbond]

It's a fire zone, so pretty much the properties are locked into Farmers, and First American (DP-3). Declined by SafeCo and Travelers. I was thinkin that the wrongful eviction would be good coverage from the commercial policy, plus the additional $1M-$2M aggregate would be nice over the standard $300K OL&T. I got a quote back, and only $700 a year, but of course the client doesn't want to pay the extra premium.

I guess the client knows best on this one...