COVID-19 continues to surge across northeast Ohio! The unemployment rate is near 9% in Ohio, a new stimulus package seems unlikely in the next month and the Centers for Disease Controls has put a moratorium order on all evictions through the end of the year (under certain circumstances). What are landlords to do to ensure they have capital to continue to operate as a viable entity? Read more….

A relatively new product in the United States –Rent Guarantee Insurance – may be available to assist you. Unlike business income insurance there does not need to be a direct physical loss to property for coverage to apply. Rent Guarantee Insurance pays the rent if a tenant stops paying the rent. Most policies have exclusions and must be read carefully, but one exclusion I noted in several policies is that payments would not be made to the landlord if they did not comply with the lease agreement or keep the rental property in a habitable condition.

Considered more of a financial product than a risk transfer, the underwriting of the policy will look at a different qualifying question than when underwriting property and liability insurance. Some of the underwriting items that will be reviewed in Rent Guarantee Insurance are the quality of the tenant, passing a background check, having an acceptable credit check. This review must be done on all applicants and a formal lease must be in place. Some underwriters require a reference from the tenant.

Rent Guarantee Insurance may be a great policy for landlords who are concerned with making their mortgage or tax payments, continuing maintenance of your buildings or your income stream. Every policy needs to be underwritten and being in the midst of a pandemic underwriting this type of risk may be more difficult than in the past. Exclusions may preclude recovery from Covid-19. However, this may still be a great time to meet with your Trusted Choice Insurance agent at Richey-Barrett Insurance to discuss all of your insurance needs.