From devastating floods to slip-and-fall lawsuits, insuring apartment buildings is no simple task. And with rising property values, more frequent catastrophic weather events, and emerging risks like habitability claims, it’s never been more critical to help your clients navigate their insurance options.
In this guide, we break down the key coverages every apartment building owner needs, highlight common claims, and show you how to offer tailored solutions that keep your clients protected in an ever-changing market.
Why Should Your Client Invest in Comprehensive Apartment Building Insurance?
Apartment buildings present unique insurance challenges because of their dense living arrangements, high occupancy turnover, and shared spaces. Unlike single-family homes, apartment complexes face heightened risks — damage from one unit can quickly spread to others, liability claims can stem from common areas, and evolving building codes can demand costly upgrades.
Without the right coverage, property owners could be exposed to significant financial and legal risks.
For this reason, purchasing comprehensive apartment building insurance is one of the best investments your clients can make. Not only are they insured in the event of a covered risk, but they can also sleep well at night knowing they have a policy limit that is high enough to cover whatever gets thrown their way.
What Kinds of Claims Get Made in Apartment Buildings
As a team, we’ve seen all kinds of claims related to apartment buildings. Here are some of the most common that your client should be aware of when determining their coverage needs:
Slip and Falls
Slips and falls on apartment building property are among the most frequent claims we encounter.
These incidents can lead to lawsuits costing thousands of dollars in legal fees, not to mention potential damages if your client is found liable.
For example, a resident suffered severe injuries — a fractured tibia and fibula — after slipping on black ice while walking to her car. She sued the apartment owner and property manager, alleging negligence in both preparing for a winter storm and removing the ice afterward.
Incidents like this are far from rare. In an incredibly public case from 2024, a Seattle woman successfully sued both the city and local building owners after a similar slip-and-fall accident. The court awarded her a staggering $13 million in damages.
Although this incident was not connected to a Distinguished client, it’s important to note because it shows how much a single incident can cost. This multimillion dollar payout goes far and above many apartment building liability insurance limits and highlights why having comprehensive umbrella insurance to fall back on can be so important for your clients.
Fire
When it comes to major claims for apartment buildings, few are as devastating as fires. Beyond the immediate destruction caused by the flames, even the unaffected parts of the building often need to be torn down and rebuilt. Adding to the challenge, owners may also face additional expenses if building codes have changed since the original construction.
Take, for example, a case where a fire destroyed 75% of an apartment building. While the remaining 25% was structurally intact, it was condemned and deemed unusable by the government due to safety regulations.
Fortunately, the property owner had Ordinance or Law Coverage A as part of their insurance policy, allowing them to receive the full building limit for the loss. In addition, their policy included Ordinance or Law Coverage B and C, which covered the cost of demolishing the undamaged portion and rebuilding the structure to meet updated building codes.
Without this comprehensive coverage, the owner would have been responsible for the full costs of demolishing the still intact parts of the building, plus rebuilding back up to code.
Severe Weather
Another common claim is damages related to severe weather — and not just floods or storm damage.
For instance, in Denver, hail and severe wind caused major damage to the exterior of a building, roofs, building interiors, HVAC units, and other structures on the property.
These kinds of incidents happen all the time and can cost owners tens of thousands of dollars in repairs, plus the potential need to pay for temporary housing for affected tenants.
It also shows that being aware of any separate deductibles for wind or hail is an important part of assessing your client’s coverage options.
What Does Distinguished’s Insurance for Apartment Building Owners Cover?
Distinguished offers insurance for apartment building owners through our City Insurance Program and New York Brick & Brownstone Programs. These programs include insurance that is fit for apartment buildings of all sizes and types, including those where the owner lives on the premises.
With our city homes insurance, your client will get coverages like:
- Property: For damages to the apartment building itself or property in the common areas that fall under policy coverages.
- General liability: Covers the costs of fighting litigation plus covered damages that might come from it.
- Equipment breakdown: Pays for the costs of replacing building equipment like elevators or ACs.
- Sewer and drain backup: For the costs of water damage resulting from a backed-up sewer or drain.
- Ordinance or law coverage: Covers the cost of repairing or rebuilding structures to meet current building codes after a covered loss, even if the existing structure was not up to code.
- Earthquake and flood coverage: Provides protection for damage to the building and common areas caused by earthquakes or floods.
- Crime insurance: Protects against financial losses caused by theft, burglary, or employee dishonesty, covering stolen money, securities, or property.
Other specialized coverages that Distinguished offers include:
Hired and non-owned auto: This coverage provides liability protection if a building employee is involved in an accident while driving a leased vehicle. It covers physical damage to the other vehicle, bodily injuries, medical expenses for anyone injured (other than the insured driver), and legal expenses if the insured is sued for negligence. We offer coverage up to a limit of $1 million.
Personal lines coverage: For owner-occupied properties with up to four units (where the owner lives in one of the units), we provide commercial insurance for the building along with optional personal coverages. These include $1 million in personal liability, coverage for personal contents, inland marine for scheduled valuables, and additional living expenses. This allows the owner-occupant to insure both the building and their personal unit under the same policy.
Employee benefits liability: This coverage protects building owners against errors or omissions in the employee benefit plans they provide. For example, if a property owner hires a new manager and includes medical coverage as part of the compensation package but forgets to enroll them in the company-sponsored health plan, this oversight might only come to light when the coverage is needed. Employee Benefits Liability insurance steps in to cover the benefits as if the employee had been enrolled. We offer coverage limits of $1 million.
For more details on these policies, please take a look at our City Insurance Program page.
How Much Does Apartment Building Insurance Cost?
Apartment buildings come in all shapes and sizes, so it’s nearly impossible to give a blanket answer to how much apartment building insurance costs.
However, we can give you an idea of what will influence the costs of a policy. When our underwriting teams evaluate a new policy, they primarily look at the following three factors to determine pricing:
- Maintenance: Whether the property is well looked after and is free from any characteristics that would make it more risky or ineligible for coverage.
- Size: Buildings with more units or exposure types will cost more to insure.
- TIV (total insurable value): Higher replacement costs for the building and covered property directly increase the premium.
If your client is looking to get a quote for their particular apartment building, reach out to our team with their details or learn how to register and submit business directly to us in the section below.
Why Partner With Distinguished for Apartment Building Owner Clients
While the number of insurance providers on the market seems to shrink every year, there are still plenty of options for you and your clients. So, why should you choose Distinguished to insure your clients’ apartment buildings?
Here are just a couple of factors that help us stand out:
- Consistent market presence: We have been insuring city apartments and New York brick and brownstone properties across the U.S. for nearly twenty years. So whether it’s tomorrow or five years from now, we’ll be there to help you and your clients.
- Suitable for all kinds of clients: We insure all kinds of apartment buildings and real estate projects, from condominiums with 100 units in Chicago to 10-unit brownstones in New York.
- Human underwriting: Our underwriters assess your risks through discussion, not just algorithms. We prioritize human insights over automation.
- Competitive pricing: Our policies are well-priced, offering high value and extensive coverages.
- Sedgwick Repair Services: We’ve partnered with Sedgwick Repair Services so your clients can access a list of vetted tradespeople should their building need repairs.
- Umbrella policies: We offer umbrella policies up to $130 million to give your client even more coverage at affordable rates.
Partner With Distinguished Today
Registering with us is free and can take as little as five minutes.
Submit your business through our convenient online portal. Typically, our team can get you a bindable quote in two to three business days.
If you have further questions about our City Insurance Program or New York Brick & Brownstone Program, please reach out to our team, and we’ll get back to you as soon as we can.
Apartment Building Insurance FAQs
Are there any properties you don’t insure?
Typically, we won’t insure any properties that have not been updated in the last 25 years. Other property types we won’t insure are garden-style apartment complexes.
