A Closer Look… City Insurance Program

The Distinguished City Insurance Program provides specialized insurance coverage to meet the needs of property owners and landlords for homes in select cities. Eligible classes include apartment buildings, condos, co-ops, brownstones, and mixed-used properties up to 100 units in a single building or listed on a schedule.

When insuring city homes, particularly properties with multiple units, there are certain exposures that pose a greater risk. You want to ensure the insurance program you offer provides the proper coverage.

The Importance of Equipment Breakdown Coverage

Building equipment, for example, is often exposed to different hazards than other types of property, such as power surges, electrical short circuits, and mechanical forces. In a large property, if there is an equipment breakdown, the expenses can be significant for the property owner. Let’s say the air conditioning system in a 90-unit apartment complex is damaged. There is the cost involved to replace the system (or repair it if possible), the potential for extra expenses to limit the loss or expedite restoration, and business income loss. Distinguished provides Equipment Breakdown coverage as part of our City Insurance Program (City Multi-Family, City Landlord, and City Condo programs), up to TIV limit not to exceed $25M.

The ABCs of Ordinance or Law

When insuring larger properties, the need for Ordinance or Law coverage becomes even more apparent. You may have property damage to part of the building that also requires the undamaged portion of the building to be replaced, as it’s rendered unusable or condemned by ordinance. There may be demolition and cleanup costs involved. If it’s an older building that has been damaged by fire or other covered loss, it may not be up to code. There will be increased costs to update the property to comply with local ordinances or laws. We provide the limits to help cover these costs. Our City Insurance Program includes Ordinance or Law coverage including limits to cover the loss to the undamaged portion of the building and additional limits for demolition costs and increased cost of construction.

Additional Insurance Extensions for City Insurance

Main sewer lines can easily deteriorate, crack, collapse or become obstructed over time. The main sewer line is owned and maintained by the landlord or property owner, including any part of the line that extends into the street or public right of way. Not all insurance policies automatically include Water Backup or Sewage Backup coverage and, when they do, often they do not provide the Sewer Backup limits we do.

In addition, look into the opportunity to add Earthquake and Flood insurance, which are perils excluded in a Commercial Property form. Depending on the location, these two coverages are critical. Even insureds in low-hazard flood areas should consider purchasing Flood insurance.

Employee Benefits Liability coverage can also be added to protect building owners against potential errors or omissions in the benefits plans they provide to their employees. Let’s say the property owner hires a new manager and part of her employment package includes medical coverage. The property owner fails to add the new employee to the company’s sponsored health plan, which is discovered when the coverage is needed. Employee Benefits Liability insurance will pay for the benefits as if the employee were enrolled in the plan.


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