Landlord Insurance and Liability Issues in Houston

Mary Ann,

Please post this blog to bigger pockets:

Landlord Insurance and Liability Issues in Houston

When you own investment property and you have tenants living in that property, you need to make sure you have the right landlord insurance in place. This will protect you and your property against any liability issues. One of the things people don’t realize is that if you have a property manager taking care of your property, you can get your liability coverage lowered with your insurance company. Most property management companies have a liability policy of their own that covers them. Lowering your own insurance will increase your cash flow and keep you protected.

If you aren’t doing proper credit and criminal background checks on your tenants, you have some huge liability issues that could cause you some problems. I know a lot of landlords think it’s a time consuming and frustrating process to do these checks, and sometimes they prefer to go on a hunch when screening tenants. That’s a bad idea, and here’s why. If you put a sex offender or a murder or a rapist in your property and something happens, people are going to start knocking on your door, and they are going to want to know why you let that person into the neighborhood and into your property. There’s a good chance that you’ll be involved in some sort of litigation.

Check out your maintenance people too. A lot of landlords are tempted to use the cheapest guy around, and it’s usually someone with a truck who is unlicensed but willing to do work for a lot less money than professional contractors. I used to do that when I first started investing in property, but if that person doesn’t have insurance and they aren’t bonded and licensed and you don’t know who they are, you will run into big problems. They could go into your property with a tenant living there and if something happens, you’ll have to answer for why you let that person into your property. Make sure your maintenance people are qualified. It might cost you a little more, but cheaper is not always cheaper. I always tell landlords to run the property like it’s a business whether you have one property or 50.

You will always have expenses, so start a rainy day fund. When it does start to rain, you don’t want your umbrella to have holes because you bought the cheapest one.