Some of this is going to depend on the LPI policy you have.  

Turns out there is coverage in my rental insurance policy for additional utility expenses.

We have a policy where the tenant pays a late fee if they are a day late up to one week late, and a second late fee if they are late during the second week.

An umbrella policy is a great way to go.

I would look at some criteria and set it, then if someone meets it use a first qualified or best of the pool method for selection (risk management and takes some guess work out)...Back to the objective facts, I would steer clear of anyone with an eviction, living rent free for an extended time in a manner that was not clearly legal, and theft, think about a policy based on misdemeanors/felonies and a time frame (like misdemeanors ok if 10 years back or not relevant to tenancy)...

Then they say you can use reserve funding from proceeds, drag out the closing so there are no reserve funds anymore and then ask for an account with money in it because they changed their policy.

with all my respect to all posts and remarks on this issue, no one mentioned the role of the local Governments and their policies.

On the other hand: our policy is that tenants are responsible for pest control.My dilemma is how I might handle this.

(iii) (CLOSING COSTS --> TITLE EVIDENCE AND INSURANCE):[MIAMI-DADE/BROWARD REGIONAL PROVISION]: Seller shall furnish a copy of a prior owner’s policy of title insurance or other evidence of title and pay fees for: (A) a continuation or update of such title evidence, which is acceptable to Buyer’s title insurance underwriter for reissue of coverage; (B) tax search; and (C) municipal lien search.

You would need a full time staff person just to manage this task.With this product you have 1 policy you manage and renewal on an annual basis.