7 steps for Atlanta property investors to save on insurance

Standard insurance carriers

Atlanta Property Investors

Atlanta is a rapidly growing city, which is leading to a real boom in the real estate market! The construction of the Belt Line has been successful in shaping Midtown and the surrounding areas, and in making Atlanta a more accessible city. There’s also two brand-new state-of-the-art stadiums for both the Atlanta Falcons and the Atlanta Braves. Atlanta is also now one of the top film industries in the world, which means there’s an influx of people moving to town, at least temporarily. These factors coupled with the affordable cost of living in the South add up to make Atlanta an ideal location for property investors.

However, if you are a property manager looking to invest in Atlanta, you also need to consider the area and how to best insure your rental dwellings. How do standard insurance carriers decide whether they want to insure a property? What are some factors to pay attention to for local buildings? The following are seven details that can keep your property in the standard insurance market – and help Atlanta property investors like you avoid paying higher premiums. 

What can help Atlanta property investors stay in the standard insurance carrier market?

1. Wiring and plumbing. 

Remediate any aluminum wiring. 

Aluminum wiring is not something that standard insurance carriers want to see in a multi-family building because it’s a known fire hazard. (Copper is used now, and it is not a fire hazard). Pay close attention to any buildings that were built in the 1970’s, as that was prime time for aluminum wiring usage. The risk of fire that your building presents has a huge impact on what kind of insurance you can obtain. You may be able to undergo remediation if your Atlanta building still has aluminum wiring, but you have to take care to do this right so that your building will be acceptable to insurance carriers. Going through the appropriate remediation can help Atlanta property investors re-enter the standard insurance market. 

Remediate polybutylene plumbing. 

During the late 1970s through the early 1990s, polybutylene (“PB”) piping was used during new construction in order to save costs, but it was soon evident that this material was likely to expand, burst, and otherwise cause problems. There was even a class-action lawsuit against the manufacturers of PB piping, although that lawsuit has expired. Standard insurance carriers don’t like to see PB piping because they see that as raising your chances of filing a claim. (And a water damage claim at that – since water damage can impact more than one unit in an apartment complex, it becomes a real hassle and nightmare.) If you have PB piping in any of your rentals, you will want to look into remediation methods in order to get your building updated. 

2. Occupancy rate. 

Occupancy rate is an important factor when insuring a rental dwelling. Standard insurance carriers often have a certain percentage where they see the building as being “occupied” versus “vacant”. This matters because vacant buildings present a higher risk of a claim since there are fewer people around to catch any potential issues, and standard carriers are wary when there is little oversight. (We’re establishing a trend here, right?) A vacant building is at a higher risk of vandalism, for example, and there wouldn’t be anyone there to call 911 in the event of a fire or raise the alarm about a burst pipe. Yes, your tenants present their own brand of risk, but in this case, the tenants are also quite helpful to the landlord since they are able to notice any issues.

3. Maintenance 

The roof. 

A major appeal of the city of Atlanta is the fact that there’s a lot of green. Atlanta has a lot of trees, but trees themselves can pose a risk when they are located next to your rental properties. Any insurance carrier is going to want to see that trees (even the healthiest trees in the world) are properly trimmed back away from the roof, and that the roots don’t pose a risk to the foundation.

Unfortunately, roofs are not yet made to be indestructible. Their average lifespan is between 30-40 years, so pay attention to when the roof was last completely replaced. If you’re looking at a property that hasn’t replaced the roof in 30 years, that’s something you must budget for. Insurance carriers will always ask when the roof was last replaced since roofs, after all, protect buildings against heavy storms – all too common in Atlanta – and animals. If your roof is on the newer side or if it’s been well cared for, a standard insurance carrier will be more willing to insure your building. 

The grounds. 

You also have to take care to maintain the grounds of your building in order to reduce unnecessary liability risks. Standard insurance carriers want to see that you have taken steps to prevent people from getting injured on your property, which means taking care of any potential tripping hazards, such as protruding tree roots, and cracked cement/asphalt on the driveways, walkways, and patios. Maintaining the grounds can help to reduce the risk of property claims, like fire, but it’s the liability claims, like trips and falls, that maintenance can help prevent. 

One other groundskeeping point: Atlanta loves its pinestraw, but it’s necessary that you make sure your landscapers aren’t piling pinestraw against your building. Pinestraw is actually quite flammable, so this comes up on inspection reports a lot. 

4. Wood-burning fireplaces. 

If your building has wood-burning fireplaces, you should know that standard carriers aren’t fans. You may not even allow your tenants to even touch the fireplace, but that doesn’t matter. Just the presence of the fireplace is enough for a standard carrier to bow out. (Again, it’s all about fire risk. Wood-burning fireplace … probably not something an insurance carrier is going to approve of. Lowering your fire risk is important if you’re trying to stay in the standard insurance market.) Look at either boarding up the fireplace so it is not physically accessible, or change the fireplace into gas.

5. Grills. 

If you have an apartment complex, it’s imperative that your leases are clear that any grills must be kept in common areas. Your tenants cannot keep them on balconies or patios. It’s not that insurance carriers don’t like barbeque – it’s that they see the fire risk, yet again. (Especially if your building has frame construction. Yikes!) The grills should also always be kept safely away from the flammable materials.

6. No smoking inside. 

Smoking presents its own set of fire risks. Cigarettes might be tiny, but in an instant a butt that isn’t completely out or sparks falling onto a heap of pine straw can turn into a major fire. So – the reasons for prohibiting smoking inside the building are twofold: First, it helps to keep your tenants safe. Second, it helps keep your buildings safe, and anything you do as a landlord to protect your buildings is ultimately going to show in your insurance premiums. For multi-family risks, make sure to provide appropriate disposal methods that are easily accessible in common areas  for your tenants to use so they have a place to dispose of their cigarettes.

7. Pool safety. 

It’s no surprise to most to hear that Atlanta has a very temperate climate, and the weather is right for outdoor swimming for up to 6 months out of the year. If you have a pool at any of your rental properties, it is imperative that  pool safety is a top priority. Putting proper safety measures in place reduces your liability risk, which standard insurance carriers not only like, but require. Keep the following in mind:

Fence-in your pool and only allow tenants access by means of a key card or key fob. 

Post pool rules: No running, no glass, no alcohol, no swimming outside of posted hours, etc.

Keep hours limited to day time. Make sure that the pool hours follow natural daylight – no swimming after dark.

Clearly visible depth markers prevent people from thinking either that the pool is deeper than it is, since diving into the shallow area of the pool leads to some bad injuries, as well as allows those trying to keep young kids safe away from the deep end.

Make sure that safety equipment is not only visible, but also accessible. In case of an emergency, people should be able to easily see and grab the safety equipment around the pool. 

Two means of egress: Having at least one ladder at each end of the pool means if someone gets into trouble while swimming, they’ll have an easily accessible way out.Keep hours limited to day time. Make sure that the pool hours follow natural daylight – no swimming after dark.

Have clearly visible depth markers. That’s extremely important. 

Make sure that safety equipment is accessible and visible. In case there is an emergency, people should be able to easily see and grab the safety equipment around the pool. 

There are plenty of advantages Atlanta property investors to be able to stay in the standard insurance market, of course. But that means you need to put some effort into reducing your risk. That could be your fire risk or other property risks, or that could be your liability risk, like someone face-planting on to the concrete. Rather than waiting for a catastrophe to happen, you can take steps to head it off and prevent it. The key to keeping your insurance rates down is to stay ahead of any potential issues!

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