Insurance

[Mark M.]

I understand that if the deed lists an LLC then the insurance needs to list that LLC. What if the deed lists the LLC and the insurance lists the owners by name and the LLC as additional insured? Is this sufficient protection?

Thanks!

[Account Closed]

From your description it sounds like you ha a homeowners policy and have listed the LLC as an additional insured on that policy. If this is the case there are two potential issues you should consider:

1. The business pursuits exclusion in the liability section of a home owners policy specifies that there is no coverage for a loss arising out of a business pursuit. A rental property would absolutely be considered a business pursuit and your claim would likely be denied even if the LLC is listed as an additional insured.

2. The named insured must have an "insurable interest" in the property in order for coverage to be provided. Technically the LLC has an insurable interest in the property and not you which could be grounds to deny the claim.

A dwelling fire policy can be added to your personal insurance for a limited number of small investment properties. However, I would recommend looking into a commercial insurance policy which will provide better coverage, is more flexible and can grow with your real-estate portfolio.