@Matthew McNeil. There's been a whole lot of smoke blown around on this thread. Mostly by PMs trying to sell a bill of goods but nobody has given an example of how it benefited an owner in a law suit or even benefited the PM in a actual lawsuit. Lots of theory but no real life story. That's how you separate the experienced from the new guy. The new guy can talk about it but has nothing that backs it up The truth is the lawyer targets the money (or goal) before he files the suit. The house and LLC it's in have value and the insurance policy has value. What some of the PM's on here are doing is making themselves a target for suit because in order to collect all the money from the insurance company they HAVE to name the PM who is riding the shirttails of the liability policy. Something else that's missing here is that many land lords use Umbrella insurance policy's to add additional protection. somebody was talking about a 1.1 million dollar settlement. News flash most commercial policy's provide 150-300k liability coverage. If you get hit with a 1.1 million settlement most likely you will come up way short. That's where the umbrella comes in. They usually require an increase in the primary liability from the standard 150-300k to 500k or more. Then they insure against all claims above the primary insurance maximum. The Pm has access to this insurance as well as the owner but he has to pay for it himself. Mine for 10 units used to run about 450 a year, plus the added cost to raise the limit on the primary coverage. (Less than $50 a year per unit one of mine was done at no charge). The only thing you are doing by adding the PM as an insured is cutting your own benifit in half, saving him the few dollars he would have to pay to get his own umbrella policy, and adding him as a target to be named in the suit. Check with your insurance agent. You don't have a million dollars in liability unless you expressly added it when u bought the policy. I understand Loyalty to your PM. I fired one after 10 years. It was for other reasons but you have to remember we are all running a business it's not a social gathering. You HAVE to protect your interests. Splitting you insurance benefit with your PM probably isn't doing that. RR. @Ricardo R. I live in Colorado now and have for 2 years. I self manage my storage units and 3 of my properties. I know full well what you guys deal with. Cash flow on a rental property is a highly debatable item on this website, and many feel comes in second to appreciation or value add opportunities. The PM has little or nothing to do with cash flow. It's set at purchase by the way the property is financed, price paid, market rents, property condition, and many other factors way out of your control but in the control of the owner when he bought it. quite frankly the PM has little or nothing to do with it. I use them because it's easier to manage 2 or 3 PM's than 30 or forty properties. If you check out an IRR calc. You will see the real money is in the back end not the cash flow. Granted in some places cash flow is all your ever going to get and in that case a PM that can save you a few dollars on a plumber is helping your cash flow. RR
