Triple Win LIVE: Renters Insurance Breakdown

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Air Date:
March 24, 2022

Close to 90% of Property Managers require renters insurance, but only 41% of residents actually carry it. Think about how wide that compliance gap is and how much it could truly cost you, the resident, and the investor.


​In this episode, we answer YOUR questions about renters insurance and the process around it.


Listen to learn how to get 100% of your portfolio covered... 100%.


​Hear about the pet programs PMs should be managing and running.


​Find out the questions you SHOULD be asking your insurance provider


We hope you enjoy this recording of our latest Triple Win LIVE!


Got questions? Email us at triplewin@secondnature.com


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Hosted by Andrew Smallwood and Laura Mac

Featuring Michael Tinetti

Produced by Andrew Smallwood, Laura Mac, and Carol Housel

Edited by Isaac Balachandran

Transcript:

Steve Pardon:
So we had our gal chili cheese fries and she called our office and she said, “J Max, I was cooking some chili cheese fries.” This is a message literally that she left “and I burned up the kitchen.” And that's literally what happened. She was cooking some chili cheese, then she burned up the kitchen. Fortunately, with her carrier, it was pretty easy. We filed the claim with them. Because we require, like Karen does, on the back end, all of that work that she's talking about, we filed it through them. They sent an adjuster, blah, blah. When claim time comes and another cheese fries burn up my next kitchen, how do I get my owner's kitchen covered through Second Nature?

Andrew Smallwood
Holy cow. It's got a lot of questions, and that's relevant because it's a hot topic. But the Second Nature decided just last week that was there's a lot of families being affected overseas. It's not something where our business is international and directly in a place to help those folks. So indirectly we asked what we could do and triple in mind, said, hey, how can we give property managers what they want? How can we give families in need what they need and do it in such a way where it's fun and enjoyable for Second Nature as well? And so we're donating $20 for every question asked on Triple Win live, including those retroactively that were asked before we decided to do that. And so happy to say we've got over $1,000 raised before this even starts, which is really exciting. And we're expecting a lot of great questions and a lot of great conversation today. But Laura Mack is going to be looking to the chat, put your live questions in the chat as you have them here today. We'd love to bring you off of mute and shoulders, help queue you up, and bring you on and we'd love for people to chime in.
It's okay if you've got a question or comment to put it in there and jump in the mix. So we'd love for it to be much like the lobby bar, but a digital version of that and a little more structured so we can get some great content out of this. So we'll give live questions. Priority. We've got a bunch of questions submitted in advance we can go to and any that we don't get to in our scheduled time today. We're committed because of the whole $20 raised. We don't want to put any barrier to as many questions being asked. We will commit to answering them and the Triple Win property manager group and Laura will just drop a link to that Facebook group. It's a private Facebook group just for professional property managers like yourself and you don't have to be a Second Nature customer to be a member of that group. You just have to be a professional property manager who believes then stacking Triple Win experiences for residents, investors in your property management teams making property management better for everybody. If that's the way you think about the business and want to be building the business, then that's a place you'll belong. And we'll answer a number of questions there that we don't get to live today with that.
I also have a special guest who I'd like to introduce to everybody. Michael, tonight, just do a brief, insufficient introduction. We actually met Michael when he was a senior product manager in the insurance division at Real Page. Many of you are Real Paige customers today and friends of real pages. We are. And I know, I know Michael has many friends there still, but that's how we first met and started talking to Michael about insurance. And then he actually made a career move into insurer tech you know more directly really exciting space and an exciting company there called Get Covered. I think Brandon, the CEO is even here with us today checking in which is cool, and anyway, our conversations continued and Michael has been a really important collaborator and contributor to what Second Nature is doing in the insurance team and what we're rolling out. So we'll get into that a little bit today. I know a lot of people are eager and have questions to hear about what Second Nature is doing specifically, but that's it. So just to recap, $20 for Ukraine, every question format live Q&A here. You can ask questions at any time. We're going to do a Triple Win breakdown on insurance. Here to get started, we've got Michael Tinetti and questions submitted in advance. We'll get to as many as we can. Otherwise, the Facebook group is real. Check that out. If you don't get your question answered here today. So want to kick this off with a couple of statistics I found that are relevant. Just setting some context for this. There was an orchid study and it showed that 41% of renters have renters insurance. 41% of renters have renters insurance, despite the fact that, as we asked many of you who register for this event, I believe is around 80% or higher, making it a requirement to have renters insurance. And even people we surveyed before this event, it was even higher than that closer to 90% of folks. It's a requirement to have renters insurance and yet only 41% of renters do. And so there's a compliance gap. We'll talk about why that happens and ways you can close the gap as far as that's considered a couple of the things we found in our research that were kind of interesting in the way we think about coverage is call it three buckets. And you may have seen this in the promo of the three types of insurance that are critical to think about, you know, as far as what you're going to have. And there will be specific coverages and self-limits in detail we're happy to get into today, but if you think about the three buckets, there's first you've got the property damage, you know, the property liability section and what can follow on the resident there. That's part that you typically see around $100,000 in coverage. There are some interesting questions that came in about that we can get into, and that's one key, one key place where coverage is falling. Second is what we call the legal and personal liability as it relates to the resident and finally as the contents and belongings coverage type of bucket. And so those three buckets are important to look at one key thing for the contents that you question you'd want to ask about, any policy that you're looking at is for the contents coverage.
Is it replacement cost, value or is it actual cash value? Is that right? Michael, is that cash value? Is that right? Yep. Yep. Actual cash value or replacement cost value.
So our CVX versus ACV is how we abbreviate that replacement cost value. Why this is important. Michael, maybe you could give an example of the difference here, but it doesn't mean that our CV is always the right choice. I mean, if you had a second home, like a vacation home or something like that, and you didn't mind taking time to replace your contents and things like that, for actual cash value because it brings the cost of the premium down, it could be the right selection, but generally the higher quality coverage, the better coverage is going to be replacement cost value And Mike, would you mind just giving an example of kind of how that plays out, how that difference plays out in a claim?

Michael Tinetti:
Absolutely. So think of electronics, for instance, my MacBook. If I have a ten-year-old MacBook that gets damaged and you have to replace it, the actual cash value would provide me with a claim payment in the amount that that ten-year-old MacBook was worth at the time of the loss, which obviously they depreciate at a pretty decent rate these days with the way Apple turns over their products, whereas replacement cost value would pay you out in an amount that would allow you to get something off like the kind in quality. So it's just providing a more substantial payout and not as much including depreciation and the loss adjustment as an actual cash value payment.

Andrew Smallwood:
Michael, thanks for that much. Appreciate it. Here's another thing we found in the research we were doing last year is dog bite insurance. All right. Some interesting stats. Four and a half million people suffer dog bites in the United States every year and it's over. 880,000 of them at least in 20, 15. That was the number who require medical attention.
Right. As a result of that and a number of lawsuits and legal liability as relates this generally about half the people affected are children. And so it just becomes a very difficult and kind of sensitive thing. State Farm, who's one of the largest kinds of retail insurers for three policies, homeowners policies. You know, their stat one-third of all claims payout was dog bites 750 million bucks. And so it's a critical and important coverage to have and yet so many people in the renter's insurance space do not provide it. And those that do often restrict what breeds are covered it's like okay Chihuahuas are covered and then here's you know 16 other breeds that are over £50 where they're not covered at all. It's like all dog bark and no dog bite insurance out there. There are a lot of people really avoiding it because again, they're concerned about the loss ratios. It's understandable and the risk that goes into that, but it's a very real risk that affects folks. And we know this is especially important to property managers who are Triple Win property managers and have smart pet programs where they're saying we want to allow, you know, all breeds and all types of pets. Many of you work with pet screening many of you have pet damage guarantees and things like that as a part of your programs to owners. And it's so, so smart to do. But, you know, the question is, okay, approving residents and approving residents that have these breeds when they're not insured and that risk is not addressed. You know, it's an open question and a big issue. And unfortunately, we're seeing a lot out there, and that's a gap. We really spent months, quarters, in fact, efforts to close and address. So just a couple of things, you know, as a backdrop and some information that's specific that will be relevant, what we cover. And then the final thing is this and just our trouble and break down the words start opening up for questions, feel free to put them in the chat and we've got a lot of them to hit today. So here's a couple of things I'm just going to break down like kind of the top ten things one-liners here that were important to us as we looked at it. Number one was there wasn't a 100% managed solution out on the market. And what I mean by that is, hey, 100% of residents are offered a policy that is compliant with the property managers' requirements. And again, we'll talk more about that in a minute. But then it's compliant managed throughout the entire lease. Let's say somebody does purchase insurance either through the offered or referred policy or outside of the policy. You know what happens three months down the road when they don't pay their premium and that policy lapses right. To ensure that coverage is taken care of. And there's a 100% compliance solution throughout the entire lease term. And so that was a problem that we endeavored to solve. We can share how we did it, whether you want to try to do it on your own or do it with Second Nature. Second is, you know, Triple Win. Sure. And so here we are in triple Wednesday. So we got to make the Wordplay on Triple Wins, the triple insurance of, hey, what really puts the resident in the best position, the investor in the best position the property manager in the best position said everybody's covered. Everybody's economically in the best position possible, experientially in the best position possible. And there's less friction to these aligned outcomes we want of people being protected and taken care of with a high-value policy.
Number three is a lot of the insurance providers out there. And you think even about the software providers that have started to offer stuff. A lot of what we've seen is so much of their customer base is large multifamily providers. And when you think about the fire risk of a 400 unit building, right, that's very different than the fire risk of a single home. Right? And what that would cost, etc. But so many of the insurance products that are out there and that we've seen are really built for large multifamily because that's where a lot of the volume is. And, you know, not for the single-family or small multifamily type of folks that we work with. And that created a problem. It also created an opportunity to drive a higher value. Next is thinking about the just highly regulated nature of insurance. And hey, you can't sell insurance unless you're a licensed agent, right? There is an ability to offer or have a refer to preferred policy, etc. We'll get into the dynamics of this. But as far as actually being paid commissions, etc., there's a number of folks out there paying marketing fees and things like that. And listen, not an attorney. There's a gray area in some of these places that we can admit to. But hey, we certainly if we were going to do something it was going to be something that we felt very strongly was going to be compliant. And it can be difficult and people don't want to expose themselves to risk or necessarily go through all the hassle of becoming a licensed insurance agents agent or having an agency to be able to do it. We also saw this interesting bifurcation in the market, and there might be folks on this call who say, Andrew, my insurable interest is not in the resident's belongings and their contents right I don't have any insurable interest in that. Like I hope nothing would happen for them. And I, you know, probably they should go get contents, insurance, etc. But as far as the property and my fiduciary responsibility to the investor, etc., really, I'm focused on this property damage type of piece and potentially some of the liabilities around it that could affect me.
But the personal contents, belongings, I'm not going to come out and say that that's really where I want to stake my claim or have a requirement for that or those kinds of things. Or even make that a standard offering. And so I really just want these one or two buckets covered. Whereas other folks were saying, no, we want all three buckets covered the highest value possible for the resident residents. Well, and so we'll get into that. And we've addressed solutions for both folks because we felt there were reasonable perspectives on both sides of that. Already mentioned dog bite and how it limits breeds if they do have it. Another one was what's called additional living expense, and this is sometimes called loss of use. And so if there's a covered peril and something happens, right, and somebody they can't inhabit the home themselves, maybe they've got to move to another rental home for a month. Right. And there's a month of rent in another space that needs to be taken care of. Or perhaps it's a hotel for a few days is probably often what many of you run into. That was coverage that we were seeing missing in a lot of places. That was highly requested and we wanted to make sure it was built into what we were offering. Another question is, what if residents want more coverage? But we talked to our sales team about is actually Bob Hanson. I'm not sure if he's on the call right now or if he's in another meeting. But, you know, Bob's our head of sales and Second Nature, former SVP of operations at Home Partners America and like many people at one time, was a renter himself. And he's one of those stories where the moving van just traveled off with all of his stuff. Right. Disappeared with all of his belongings. And he was sure glad he didn't just have $10,000 of contents, coverage or worse. No, contents coverage. He had purchased a policy with $30,000 worth of contents coverage. He was glad he had every penny. Right. So what about residents who it's not for most people, but there are some people where they've got a lot of stuff, or maybe they've got special jewelry or a couple of Rolex watches, things like that. They want specially covered and taken care of. Okay, understandable. Can they still have an outlet to get additional coverage, you know, at a great price and a convenient process? That was something we wanted to address as we did this. And in a final couple of things are when there are such wide options in pricing and coverages and just tons of questions that can come up. And many of those questions would be coming back to you and your team. It just it's the enemy of speed in the leasing process. Right? That creates friction in the leasing process in that critical outcome to getting somebody insured and in the property as fast as possible. And so how do we do this the most Second Nature way possible, right? The most friction loss way possible was something we wanted to answer. And the other challenge is a lot of people are sending people to third-party sites and they're putting down credit cards and paying things outside of the system, etc. And that can create, again, these lapses and lack of visibility into that which creates that compliance gap where only 41% of the 90% that should have the coverage. So those are kind of the problems in the triple one breakdown is we're going to go through this today and here's where to do where to start bringing people up. Laura Mac, we'll have you pull people up and just bring them up, bring them off mute we'll start answering questions.

Laura Mac:
All right. The first one will bring up is Sam, I'm going to go ahead and spotlight you. You had a great question that you submitted in advance.

Sam:
Hi, guys. So I'm different than most other property management companies in that we have mostly low-income tenants. I'd say it's like sea class areas. And so it's hard enough getting them to pay the rent on time. We have higher eviction rates, you know, all that kind of normal jazz. The only reason why I personally have not required insurance was that so much of me, I believe that I'm at risk myself if I require it because now I'm responsible to cover it, even if they're not paying for that for the coverage. So that's my question. How do you administer a renters insurance program when the vast majority of your tenants are low-income and pay rent?

Andrew Smallwood:
A great question, Sam. Really appreciate it. Thanks for being here, man. Much appreciate it. Thanks for going first. And I'll let Michael jump in on this one. But I guess I would say having an insurance requirement for residents shouldn't necessarily make you liable for damages if they are out of compliance, you know, for that and with that policies. So I guess I just wanted to clarify, are you is your understanding that if you have an insurance requirement for residents that they're supposed to be purchasing it and then they fail to do it or fall out of compliance at some point of the lease, that somehow that liability is transferred to you as the property manager?

Sam:
No. Most of the programs I've seen through either a portfolio whose provider or the resident benefit package it's, you know, you're paying for services independent or whether or not the tenant is actually paid for the services. And so I could have a situation where I have tenants that don't really want to comply and pay their rent timely, but now they're not paying for some of these additional fees because they either don't agree to it or they don't want to. And so, you know, if I was in class and they class areas, to me it's relatively trivial. But since I'm in city class areas where a $10 increase is a lot and they'll fight you over it, you know, I've just made it in the least very strongly recommended and I haven't done it as a requirement per se. I, I think a lot of property management companies especially the ones in our bum, are more catering to single-family homes on higher-income people. But for me, you know, a lot of my, my people are minimum wage mother, father, maybe a couple of kids making $15 an hour maybe. And so like any of this additional money is just it puts me at risk because it's already a relatively low margin for me. It's not worth the risk because of that. And so I guess that's my big question is how do you administer a program like that if there's a lot of risks that it's not going to pay

Andrew Smallwood:
Great question.
And again, I'll let Michael jump in, and thanks for clarifying that. Appreciate that. So, you know, a couple of thoughts right off the bat. Ah, you know, you've got to weigh the risk of nonpayment of premium and then you've got to weigh the risk of no coverage. And certainly, residents in this kind of financial position are not going to be in a place right. To pay the thousands of dollars or tens of thousands of dollars. Right. In these lower probabilities. It's not going to be the majority of your tenants that have this kind of issue. Right. But certainly, when the issue does come up and when it does arise, it could put the property owner right in a difficult position because the resident hasn't protected themselves and they're not you know, they're able to handle it and pay for it. Yeah. There's that risk that ultimately has to be weighed out. You know, I don't see, again, much of a distinction between strongly recommending and having the requirement, how much you enforce the requirement, you know, is ultimately going to be up to you and how you decide to handle that in cases of nonpayment and delinquent payment are going to be important with Second Nature in the way we think to set up things for our partners. What we have seen, you know, Sam, is generally a 98% plus the type of collection rate. Not all of that is collected, you know, right on the spot per se. But over a period of time, it's taken care of and they're able to maintain the vast majority of their policies as covered there. Michael is there something you want to add Tal, if anybody else wants to jump into it, would love to hear some other property managers' opinions on that.

Michael Tinetti:
Yeah I’ll touch on a couple of things. So in regard to your concern over, you know, requiring it and the resident not paying you if they're enrolled into this preferred insurance option, the way most of these work in the way that gets coverage program with Second Nature will work is that it's actually built in arrears. So we would never believe you for someone who did not pay you all the appropriate premium for that month of coverage in question. Now, to Andrew's point, there's still the risk of an uninsured home and there's there is damages, which is a separate risk. But as far as you all having to cover the cost of the resident insurance, that would not be applicable with the way this program is structured. And then on the flip side, Andrew touched on this earlier but that bifurcation of liability only versus contents included, there is an availability to go with a route that's a cheaper policy that provides liability-only coverage for protection for your homes from resident cost damages. So it is a substantially lower price for those residents and may be more palatable for them to stomach along with their monthly rent.

Andrew Smallwood:
Tal, thanks for joining us.

Tal Kramer:
Good to see you, too, buddy. Just a different thought on this. You know, I appreciate people might not pay for it, but I think it's more of educating your owner the value of having the coverage and setting it up so that if you have tenants that might not be paying, your owner sees the value to pick up that cost because of how much is potentially going to save them. And I would structure my deal that way. You know, we're in class A, in class B, we can make it mandatory. It's not an issue. But I look at just simple things that have happened where the tenant flushes, wipes down the toilet and it backs up and we get 10,000, $12,000 of damages. My owner, if I didn't have this policy, would end up having to have to go to their insurance product, maybe have a 1020 $500 deductible may be getting a premium increase when instead they could spend ten, 12, $15 a month, whatever the policy is going to cost and know that it's better protection for them in the event that the tenants that are paying. So I would structure it such that it defaults back to them and explain to them why that's actually to their benefit to implement it that way.

Andrew Smallwood:
And, just to answer the question off the bat, as far as pricing goes on this, it was a place where Second Nature saw we wanted to be extremely competitive on the premiums. And so for, you know, resident liability only and the property damage and the personal liability portions which we can get into more detail on what's covered there, but no contents.
We saw a lot of policies out there in that nine, ten, $11 range. You know what a lot of people eight 50 and in one case we saw and so seven 95 is where we wanted to come in on pricing for that policy, for contents included. We came in at 1095 seeing that a lot of the market out there, I was coming in at 12, 13, 14 and so pretty competitive pricing on our policies and then we actually fully manage it in the compliance throughout the lease term as a part of that.
Really appreciate your questions and does that answer your question? Did you have a follow-up?

Sam:
No, I think it mostly does it and I can understand it. I like the concept of couching it as a hey in lieu of having to actually hit your deductible and then to an insurance claim, which they're going to get back. These guys it's based on the tenant and so it's a kind of a tenant-related expense. And so for that reason, you know, if it doesn't pay it, you'll cover it, but we'll know the tenants of that tenant. We need to get them out anyway. And you'll still be covered in case this happens. I had a situation like kind of what you're referring to a couple one where a property that I owned ten I actually had tenant insurance, but the way that the damage was and how it was set up wasn't covered and like the State Farm policy. And so I ended up having to pay like $4,000 for a binder home because of the fact that the guy did it and then similarly a tenant had flushed wipes down a toilet. We can't, we couldn't prove it was because there are three tenants but I would think that hey if you have coverage on the entire house it's kind of in some regards a moot point and we had it happen three times in rapid succession and you know, we reached out to all the tenants said you can't do this, but we could never prove who it was. So, you know, I think to some level that can be very good as a way to explain it. Hey, look, we're going to administer it as a mandatory policy. It's going to be on the physical tenant, but if the tenant then doesn't pay it, you're going to be held responsible for that period. We'll try to get the money back from the tenant. They'll be held responsible for it. But at the end of the day, you know, we have to do this because we need to kind of protect your interest. And I can give them some of these anecdotal stories now.

Andrew Smallwood:
That's great. Sam, thanks again. Appreciate it. We're going to bring up Jim Smith from Austin, who always has the best zoom backgrounds so a smile in entertainment for everybody as we bring Jim up. Jim, good to see you, my friend.

Jim Smith:
And likewise, thanks for putting this on. Question. We do manage one of the few companies in town that will manage a single family that has swimming pools. And our current requirement is that we require both the tenant and the landlord to carry a minimum of a $1 million liability policy with us named as additionally insured. And if we do require that all tenants carry renters insurance, but the ones with the pools are the only ones that we make an active effort to make sure that we are insured and are notified by the insurance companies. So it's kind of twofold. Number one is, is the million-dollar policy. That's a limit that I established probably ten, 12 years ago. I kind of stayed with that. Is that still a good dollar amount to require both the tenant and the landlord to not require more? And number two, I'm open to ideas and anything else that you may offer on how to handle those properties with pools and or other water features.

Andrew Smallwood:
Great question. And Jim, just to clarify your policy right now is for residents and owners, where there is a pool on the property, $1,000,000 property damage, and legal liability coverage minimum for your properties that don't have pools, you have a separate amount and a separate limit. Is that correct?

Jim Smith:
Yes.For properties that do not have a pool require the tennis to carry a minimum of a $300,000 liability and all of our properties for single-family, where we do require owners to carry a $1,000,000 umbrella policy.

Andrew Smallwood:
Yeah. I'll offer something quick on this. I'll let Michael really speak to what he's seen as far as out there on the data, the claims, the amounts, and how to maybe think through the risk and what's the appropriate amount of coverage and how that's changed over time. Michael, if I can tie you up for that. You know, Jim, a lot of how we looked at this was thinking about, of course, with insurance. You know, part of the challenge is it's a very small percentage of folks who are going to have claims of the percentage that have claims how many of those exceed, call it $100,000, which is what you generally see as an industry-standard out there. Right. And the answer is the vast I mean, hi. 90%, you know, we're going to be under that 100,000 limit.
So it's just a question of, okay, if we are going to cater to the percentage of folks who are going to exceed that and the risk that is there, it's going to increase the premiums for everybody. Right. If we're including that in a master policy that everyone's offered and shared. And so whether it's 300 or 100 or a million, you know, part of our philosophy where we wanted to start on this was we really felt like, hey, optimize this for the high 90% of folks and then for the edge cases where it needs to be handled another way. We're going to have a path where you can have a separate requirement for those folks, for those properties, and ultimately direct them to a link where they can purchase the policy easily that meets those requirements. And so that way you can kind of bifurcate and distinguish those folks. And there's a path for both. But then the compliance can be managed across the whole portfolio throughout the lease term. As for how we approach that. Michael, do you have some thoughts on just thinking about the risks, the amount of coverages, and what we've seen over time with that?

Michael Tinetti:
Yeah, I mean, you hit the nail on the head there with the vast majority of claims falling under the $100,000 limit. Now, I do understand that with pools being involved, that's kind of a whole different ballgame. And ultimately, that's going to come down to what your experiences are and what you're comfortable doing as far as that requirement. And oftentimes what we've seen is that our pools involved, there might be a separate specific requirement for those that are renting with pools, like you mentioned, comparatively speaking, to the standard renters, when they have additional hurdles to cross and there are other avenues to get that type of insurance to reach that million-dollar personal liability limit because it is a more unique type situation than someone just having a home where they're concerned about a slip and fall. There's obviously a much higher, I guess, experience rate of people having issues with the pools themselves. As far as kind of the programs that we're implementing here, Like Andrew mentioned, 95, 99% of the clients that we've worked with require a $100,000 liability limit. Some go up to 300,000 but for the most part, it's going to be under 100,000 to no one providing a more affordable option for residents. And then number two, you know, improves resident relations by offering that affordability.

Andrew Smallwood:
Jim, great question, and much appreciated. I'm sure we'll see you either later on or at a future event. Thanks for being here. Okay. Laura, I think we've got another question cued up.


Laura Mac:
The question that Jay asks is, is there a way to increase the personal property coverage for a tenant or is it limited to ten k? Do we need to have a specific lease addendum for the insurance product?

Andrew Smallwood:
Yeah, great question. And I'm going to tie in some of the other questions that came in advance to this, which is part of the process or Second Nature was looking at. Okay. For resident coverage, again, there's always this balance of how much content's coverage, you know, balancing that out with the premium costs and how those move on a sliding scale.
What's going to create the best value for folks? And again, the vast majority of folks will not have a claim. And we were thinking about in the case that somebody does, you know, you think about their essential belongings and like what they really need at replacement costs replace right away. You know ten $10,000 really felt like the right amount from a lot of what we'd seen to set that out as far as the amounts of claims and what that was covered in the tenant profiles of our customers. And so that's where we set kind of our default coverage meaning if a resident doesn't care to get educated about insurance and everything else and they're enrolled into that 1095 policy, that's a part of the resident benefits package Very simply, signing their lease right will enroll them into that policy. However, there are the Bob Hansens in the world that we recognize that we wanted a path for these folks to call it a single-digit percentage of residents that have special considerations and want more content's coverage of what's being offered.
We wanted a simple and as easy of a path for them to get the policy coverage for them. It's probably going to cost them almost certainly going to cost them more right than the policy that we are offering. But if they want that 20, 30, $50,000 of personal content coverage, then right in the lease we've got that linked exactly where they can go and purchase a policy that's going to be compliant and tracked or if they wanted to upload their own State Farm Liberty Mutual policy, what have you. That's compliant and has the coverage that they want. We've got that opportunity for them to track that as an additional interest throughout the lease term. And if ever it lapsed and fall out of policy we can get them enrolled in lease covered into the core policy until they're able to restore that level of coverage that they want it. So it gives the resident options for the amount of contents. You know, ultimately if they want more and additional coverage, they have the opportunity to do that but still ensure that 100% of residents are covered and tracked and compliant. And so a great question came in. Thank you for that one. And hopefully, that answers a little bit of some other people's questions about how we wanted to set up the process and how it gets tracked.
All right. Tell Kramer man, you came up to help us answer a question earlier, but you had to question yourself. Can we bring you back for round two?

Tal Kramer:
Sure. I don't remember what my question was.

Andrew Smallwood:
Where's the best place to get a cocktail in D.C.? I'll turn the table on you. That's my question.


Tal Kramer:
There you go. Front page closed.

Andrew Smallwood:
Front page. I know. Maybe what farmers and fishers or... Anyway, we'll have to go sometime, but maybe it wasn't a question. Maybe it was just a comment that you put in there. How if you only have liability coverage without personal contents and it will be more often get their own policy than you have to audit.

Tal Kramer:
You know, the big thing for us I mean, we started off with the folio liability only product. And, you know, just like we did with filters and everything else, we want 100% compliance and if we give them a reason to go elsewhere, they may.

Andrew Smallwood:
Great point. That's why we're seeing a lot of people again, the 1095 policies that we're offering are price competitive to even what App Folio and others were offering on liability only. That includes additional coverage at a competitive price and certainly competitive to what residents will find out on the retail market. As just a point of fact for folks, we did a lot of research of if individuals are going out into the retail market to purchase their own renter's insurance policy to purchase a similar policy to what we've put together they're going to be paying in the teens and it does vary by state in some states you know the average renter's insurance policy exceeds $20 per month, places like Florida, etc. It's just more expensive to have insurance than in places like Wyoming just based on the natural kind of risks and things that are there and the track record and history that are there. But a lot of it as a national average was coming out in the teens as far as that. And so 1095 the including contents insurance we knew was going to be very competitive and not motivated a lot of people to look elsewhere to find a similar type of coverage. Great question and great comments and thanks for being on here. We may have to bring you up a third time for a charm a little bit later. Let's see. We've got the next question in the queue. Laura Mac, who we got?

Laura Mac:
Bringing up Karen Jordan next. And Regina, if you had a question, we can bring you up after Karen. Karen, great to see you. How's California?

Karen Jordan:
Sunny and beautiful. Awesome. Is my whiskey collection covered? Would that be a replacement or that be cash?

Andrew Smallwood:
I think Karen's whiskey collection, she may be looking to go over $10,000 or the coverage.

Karen Jordan:
I've seen some pretty special bottles back there. Right. Right. We require insurance upon moving before they even get a key. So that's been a really good policy for us. But compliance, right? That's the big problem. And I'm just wondering, like, what's the best practice and how do you how do you handle that to ensure that throughout the lease that's a compliant and keeping that policy in place?

Andrew Smallwood:
One follow-up question for you, Karen. It sounds like when residents are executing their lease, your team is saying, hey, we require you to have renters insurance and you'll need to provide to us proof that you've acquired renters insurance for the address that you're, and here's you know, here's the requirements as it relates to that. Are they just emailing your leasing agents, a copy, a receipt, or are they, you know, physically showing it to them? What's your process for asking for that proof?

Karen Jordan:
They're emailing the policy, a copy of the actual policy with us being named as the additional insured. And so we're getting that as part of their lease package prior to moving. So we have that on file and we put the date that it's set to expire. So we kind of keep track of that date. And again, as it comes up for renewal, we're reminding them that that's a lot of work, that's a lot of just follow up. But again, if it gets canceled in between, we get notified because we're on the policy. But again, it's just that follow-up in making sure and what happens if they don't renew it, if they don't get the cancel in the middle of a lease because it's a lease violation breach, we can write them up of that stuff. But we're in California, so it's all kinds of good stuff of what we can do. But I guess is the admin part of it? How what's the best practice for that?

Andrew Smallwood:
Yeah, great question. And again, your current process puts you ahead of a number of folks that you know aren't even doing that much yet or haven't figured out that much or taken on that much, been willing to take on that much to administer and track the policies. And the reality is just like you said, property managers and the staff, it's staff changes. There's going to be stuff that happens over the course of the residency and somebody falls out of compliance with their lease, even if you're notified as an additional insured or an additional interest type of party. How well does that get captured? And processed right to ensure that that resident is quickly and expediently moved towards coverage? And so the way that we have set this up is by default everybody is enrolled into the resident benefits package. They've got coverage. So if a resident does nothing right, if the default is I want to do this the easiest and most convenient way possible boom, they're covered right under the policy that's compliant. If again, a resident wants to go out and purchase their own policy because they've got different requirements or they just want a different carrier or what have you, for whatever reason, a small percentage might do that.
We've got to get a direct link where they follow those instructions and add it as an additional interest to be able to track that policy all throughout. Additionally, in the lease language, we just laid it out of, Hey, if you fall out of compliance with your policy, you're subject to and we recommend something like a $25 lease violation fee, you know, pretty standard, right? And what that can do is it can cover, as Michael mentioned, hey, the 1095 type of premium in arrears, right. Ultimately, we can back that up to the date where they fell out of compliance and coverage. So they're covered for that month, right? Or the portion of that month in which they fell out of compliance and were able to adjust the charge for the RBP to include the 1095 premium going forward from that point, assuming they want to stay in that policy. Now, let's say a couple of months later they say, no, I really do want $40,000 of contents coverage and I did fall out. So thanks for covering it at this inexpensive cost here. But you know, like to actually get this more expensive $22 policy because that's what I want. They just follow the exact same process, right, for uploading their policy of that same link that we've set up. It's tracked and then we can adjust the charge down to 95 and it's handled outside. We're tracking it there and so we're managing all of those movements throughout the lease term for the property manager and the larger movements as well. That's how we're handling it. It's, it's definitely a beast to try to take on internally and yourself when there are so many other things going on and maintenance and everything else, you know, hopefully, that's where second is adding some value of just saying we're doing this at no additional cost outside of our premium and what people are paying if they're resident benefit package customer. So is that helpful, Karen?

Karen Jordan:
Yes. Thank you. Good stuff. Always.

Andrew Smallwood:
Awesome. Okay, great. Great to see you. Looks like we've got Regina up next from Georgia.

Regina:
Parts of it had been answered, but the part that has not is just like our BP. As we're rolling that out, we're still doing as renewals happen. Is that how this would work? Yeah. Because we don't require it right now, so we wouldn't have to start that.

Andrew Smallwood:
Yeah. A, great question. And then, B, you got right to the crux of the issue and your comment there at the end, if it's always been a requirement for the property there. So anybody today, you know, there might be considerations. You know, Sam brought up some great things to get us kicked off. But, you know, generally, we would say, hey, we recommend having it as a requirement even if you're still working on choosing who you want to work with on insurance or how you want to do it. And the reason is because if you've had that requirement across all of your leases, ultimately what you can do and we specify in our lease language and everything else that we install as a part of our process say that it's really at any time a property manager can ask the resident to provide proof of current insurance that meets the requirements.
And so what that allows somebody to do is ultimately say, hey, we're reaching out. You could reach out to ultimately all the residents and have them go through this process to provide proof of insurance. And again, if they have it, great here's the process to upload it, and here's how it will be tracked from that point forward. Second, nature to handling that. If not, here's this really inexpensive and convenient option, right? To get covered versus having to go and do that. Or you can choose in the middle. Like we said, if you wanted a specific coverage, you can go shopping individual policy right here and it's going to be tracked and you can change the amounts and pay a little bit more if you want additional coverage. So that's a nice thing of being able to enroll everybody all at once if it's not part of your lease agreement, etc. I'm not an attorney and I may lean on some other property managers what guidance they would give you or what their attorneys have given them in handling that. But certainly, as a part of the new lease in the renewal process, that's a point to install it and get folks enrolled and start to get everybody covered. A very natural park, a very natural endpoint to enroll folks into the program. And into coverage. Michael, anything you'd add to that or.

Michael Tinetti:
To your point, if there's no language in the lease already, then it's not something that you'll want to try to retroactively enforce on any current residents. Like Andrew mentioned, it's a compliance issue, regulation issue, and whether it would open up a big can of worms. So moving forward with the renewals and new move-ins,  generally creates a phase up or ramp-up time of about 12 to 15 months as you get those units covered insured under the master program or third party or for whatever they decide.

Andrew Smallwood:
Thanks, Michael. Tal, I see you your hand up, man. The third time's a charm. Let's do it.

Tal Kramer:
Regina, are you using the GAR contract or the Association of Realtors? Okay, first things first. I think the GAR contract has standard language that does require them to have insurance. So you do have it in your lease already. Now it's a question of implementation. And you can start that out by simply sending out communication that says your lease requires this. We need proof of insurance. And by the way, we have this great new program but the other part that adds on this that Andrew's really well familiar with is treated the way we started with the filter program. Instead of a 12 to 15-month rollout. Again, just like I said to Sam earlier, explain to your owners why it's beneficial and make it an opt-out, not an opt-in. And your owners would pick up the cost because they benefit from this until such time as your new lease is in place. That puts it into your benefits package or whatever.

Andrew Smallwood:
We tell Tal Kramer’s story all the time, probably at least a couple of times a week to folks who are onboarding with us. Regina. And the reason is because when people were onboarding filters, utility connection, concierge credit, building ID protection, a number of the things in the resident benefit package that we offer likely that we're working with you on you can wait for a resident new lease or renewal, but you've got these folks who are a few months in between. Right. And you know, listen, there's preventive maintenance benefits, benefits to the filters, right? There are resident retention benefits and lease retention benefits, which is huge for the owners to reduce that vacancy costs. Right. And so actually, we found in towels case it was all but I think a couple of owners who said we're in, we're good, a couple who asked him about it this is that in time because towel you know he's the persuasive guy is I think he convinced the two that had questions so he had like 100% on board what we've seen across other customers who don't want to get into the one to one conversation they just let 85 90% who are in coverage for a period of time and then that you know a few percentages rather than getting into a conversation explaining it they just opt them out and let them roll in at the new lease or renewal at that point. And again you have the option to do this directly with the tenant for the insurance portion. As a part of that, you could potentially also appeal to owners on that. So it gives you some options to think about. Great question. And Tal, thanks for jumping in. All right. We've got a couple more questions coming in and keep them rolling. These are good. Hopefully, this is good stuff. And you guys are enjoying this. What do we got next, La Mac? I've got maybe Adam's question and Adam's mike is not working, so I'll read it out for him. The question is, how does pet coverage work in this policy, and what are the limits? Great question. We had multiple people ask this in advance as well. And Michael, I'm actually going to turn this one to you to talk a little bit about both the dog bite portion, which is pretty meaningful and significant as well as pet damage or anything else relating to pets involved in the policy.

Michael Tinetti:
Absolutely. I did see some of the presenting questions included a lot of questions about pet damage So I'll start there and then move to the dog bite piece. When it comes to pet damage, essentially what this type of policy would cover is if a resident had, you know, an approved pet or registered pet, as Andrew mentioned earlier, that caused damage to the home or unit in some way. Let's say it tore up the carpet, tore up the baseboards, whatever it may be. There's coverage available under this policy where you as a property manager could file a claim to get reimbursed for that loss that occurred. Now, there are small deductibles associated with that coverage, but it does allow you to file that claim and not necessarily have to pursue the resident for that amount or use the security deposit and whatnot and just provide some benefit in that capacity. So that's the pet damage piece. And then on the dog bite liability side, this type of coverage would protect the residents if they want to say they had a dog that was again approved or registered and they were outside with that dog and a neighbor was walking by, came in the yard to say hello. And then there was a bite incident and that neighbor had to go to the hospital, had some medical expenses, or filed a lawsuit. There's protection for that resident against that lawsuit to cover medical expenses for that neighbor. What have you related to that dog bite incident would be covered under our dog bite endorsement that we've included in the policy.

Andrew Smallwood:
Yeah, I think as far as current amounts, we can go and show that somebody may be listing this recording year from now and so could be subject to change down the road. But as of today, when we're recording this, if I got this right, Michael, it's $1,000 of pet damage at a $250 deductible. Is that correct? Correct. So in my example, if the dog tears up the carpet and that carpet replacement is $750 what we'd be able to payout is $500, which is the seven 50 less than Duke's 50 deductible. And what a lot of clients that we've worked with do they end up do charging that two 50 deductible back to the resident. But ultimately that would be up to you all how you decide to proceed there. And then on the dog bite liability side, that limit is 25,000 with no deductible. So again medical expenses lawsuit defenses relating to dog bites would be covered up to 25,000. One key piece this to you probably heard like registered pets which is something we really worked with the carrier on talking about because you know what we want is the incentive for residents to have transparent and clear like these are the pets or animals, right that are on site. We know many of you have pet fees and programs etc. related to that. And so you know in order to get it covered etc., we want to make sure that it's not, it's not random animals that weren't registered and haven't been a part of the compliance on the other side of your pet policies and programs there. So that helps you drive some compliance across the board. Okay, great question. Hopefully, that answered a number of people's questions. On pets and it looks like my guy Steve Pardon is in the house. Can we bring Steve?

Steve Pardon:
So we had our gal chili cheese fries and she called our office and she said, “J Max, I was cooking some chili cheese fries.” This is a message literally that she left “and I burned up the kitchen.” And that's literally what happened. She was cooking some chili cheese, then she burned up the kitchen. Fortunately, with her carrier, it was pretty easy. We filed the claim with them. Because we require, like Karen does, on the back end, all of that work that she's talking about, we filed it through them. They sent an adjuster, blah, blah. When claim time comes until another cheese fries burn up my next kitchen, how do I get my owner's kitchen covered through Second Nature?

Andrew Smallwood:
Oh, we got to have, like, a whole separate Triple Winner live. Just some, like, great insurance stories, like real stories from property management because that deserves its own episode. Probably. Well, Steve, thanks again for being here, man. Great to see you. And the answer, this is very simple. There are other folks actually we've heard in the industry, a couple of folks who have come over to our policy to work with us recently that were telling us other carriers make it extremely difficult to file a claim, like got to fill out a paper form still and you know, there's a perspective on the insurance of like how do we make this as hard as possible to do? Because that discourages people from filing claims or simply claiming and the loss ratios, the economics impacted by that. Of course, we're thinking what's the most Second Nature way possible to do this? And so essentially we would just have a dedicated page for folks to file claims depending on what the claim is if it's like personal belongings or contents. Right. Michael can help me out, but I think that would be just a resident claim and something they would file if it's property damage, which sounds like the situation you're talking about hay burned up like the actual property is a part of trying to make these changes for eyes that that claim could be filed by the property manager or the resident. Is that correct, Michael?

Michael Tinetti:
Yep. So basically, whether it's a liability claim affecting the property or if it's a content claim affecting the resident, that's where it will vary. Who files the claim? Residents are responsible for the belongings they can call. The carrier emailed the carrier, to submit that claim. And then on the flip side, if it's damage to your kitchen due to those challenges for ice, you're able to file the claim directly through the carrier as well via email, via phone and there are avenues that are available for you to file that claim. The adjuster would reach out, begin the investigation, talk to the necessary parties, and proceed from there with the process of adjustment.

Steve Pardon:
And that carrier is like a dedicated Second Nature carrier or like we're not on our own. With the carrier, right? It's like the kind of through.

Michael Tinetti:
Yes, so the carrier that will is kind of facilitating this program that we've got in place now. If it's a third-party policy through State Farm, that obviously has to go through the residence policy. But if it's the fourth through our partnership or the master through our partnership, that's all done by the same carrier that we work with.

Steve Pardon:
Cool. Thank you.

Andrew Smallwood:
Great question, man. Thanks for jumping on. I see at least five people have ordered some UberEats chili cheese fries. People are getting hungry around this time of day, probably opening up a beer on the East Coast in some places. We've got more questions rolling in, so we're going to answer them as they're coming in. I've got one in the chat here. Let's see is there a way to have the resident register for this insurance outside of going through our PM company? The answer is absolutely yes. You know, there's a referral link, and people could sign up for an HMO for a policy and a referral policy. However, to get the benefit of the master policy correct me if I'm wrong here, Michael, that's really something that we're setting up for professional property managers in driving a lot of value of here's why you want to rent from a professional property manager they're going to give you an amazing policy at a great price, super conveniently as a part of signing your lease and a resident benefits package. And so if there's questions or concerns about that, we'd love to to hear what's underneath that and potentially address that. That could be helpful to other folks. But, you know, the short answer is yes, there is a way to get referred and tracked through a policy, through a through a referred age offer that could be provided to a resident if somebody wanted to go that route. The residents just won't be getting as good of a as good of a deal in the vast majority of cases. Moving on, sticking a move in. We've got a okay, this is a serious question. This may take a second to answer, but Tracy Norris asks and says, Tracy Norris asks, we're going to answer it. Tracy asks, what is the step by step process to roll out within my portfolio? Hey, I already use Second Nature for the RV, for filters, for utility connection, for rewards. And now I'm adding credit ID and would like to include insurance as I'm bringing those in as well. The good news is, Tracy, like you already have the car on the road, right? So like you've got the minivan and it's going down. I'm 65 south. Right? Ominous. 65 miles an hour. You're just going to be adding a couple of passengers and you know, you're going to start filling up the not just the front seats but the back seats, right? With additional features to your resident benefit package. And so the good news is all of the operational pieces are really in place. It's just going to be a matter of connecting with the Second Nature, onboarding team to get your agreement updated, the pricing updated for the resident, which we'll update in the GL account on the ledger, updating the least documentation to include the additional products and start rolling that in on new leases renewals. And we talked earlier about how to accelerate adoption. I know you did that in your company to the tune of a few hundred properties getting them all on right away and credit ID insurance those products really high value for the resident going to do a lot for building their credit score protecting them for $1,000,000 policy which is really great and that kind of issues and then a renter's policy is a part of that like we talked about today. So there will be an update to the lease update to the ledger second and your team more will help roll that out. We'll update the marketing fliers and anything we created for you but all the pieces are there. It's just a matter of updating those and putting those in place. Same motions that you've already been through. Great question. I'm just seeing more about chili cheese fries here. Okay, good, good, good. Yes. 250 day one. Evan says I enrolled getting the owners on at least. That's great. Laura, I'm going to go get some questions here. Michael. If you want to pull a couple off of the sheet that was submitted in advance. We've also got, I think, maybe a follow-up question from Sam while Michael's pulling a couple of those to pull out.

Sam:
Yeah. So so real quick, again, I think that there's a logic behind like if there's damage if it's a single-family home because obviously the damage was caused by that individual tenant. But still going back to me with a five-unit building, six buildings like and you don't know, it's a backup right in the basement. So in that situation, I would assume that, again, going back to what if the entire policy is covered, the master policy with you guys, then it's very logical, it's very easy. But if you now have a situation where it's each of these individual tenants can opt-out giving State Farm versus this, it seems like it would be a little bit of a game of he said she said right. So how do you work in those types of situations? I think if I were to go with it, I would definitely go towards a master policy with you and kind of mandate it. But in case the full adoption hadn't occurred or whatever, like how do you adjudicate in those situations?

Andrew Smallwood:
And I'm going to expand just a little bit on this question because there are also some good questions that came in, Sam, about, hey, even in a single-family context, for example, you know, many cases, if you're buying a renters insurance policy and for policy, retail or otherwise, family is like included in that. But there may be like an uncle John who's not really an uncle and not really familiar post, but he's effectively a roommate right in the house in one of the rooms. And so a question of does the policy cover that? When people go out retail, generally, it'll cost a few extra bucks to add somebody who's non familial to the policy. It's not like a whole nother insurance policy, but it can be a few extra bucks per person to do that, to add roommates, you know, as an example. And you know, there's a real legitimate question of like, do you want to do that? And really, in the case of call it property damage, etc., it would be nice to include Michael. I think we have the ability to add one or two roommates.

Michael Tinetti:
Yeah. On the H 0 4 side, you can add up to, you know, I think to two or so roommates.


Andrew Smallwood:
So there's the ability to add a roommate or two, which is nice and for the property damage everything else, instead of having to go get their own policy. However, the contents and belongings benefit is worth thinking about. If you're actually the resident, right? Because hey, this ten K benefit, let's say we have an event and everything's destroyed, right? Including Uncle John's stuff and all of our stuff. Well, now that $10,000 benefit is going to be split, you know, across folks, you know, in how it's used. And so it may behoove the resident to say We've purchased this policy, etc. for our family. John, you may want to go purchase some personal belongings or your own insurance policy, etc. as you see fit. You know, if they didn't want to split that benefit, the vast majority of people again are not going to have a claim. So it could make sense to spread it out, you know, spread the cost of the premium across the house, etc. I'm not sure there's a right or wrong answer to that, you know, and how people when I want to treat them. You know that to your question, which is a really great one, which is, okay, let's say we've got a quad plex eight plex, 16 plex, whatever it is, and there's some shared systems and whatnot and it's just difficult to prove you know, where was the cause, who is the cause of the property damage that we're experiencing on the premise? That's, that's the core of your question of how is that identified and adjudicated. Can you, Michael, explain a little bit of what would be the best way to what options would somebody have to file the claim? And ultimately, what's a claims adjuster going to be looking at to identify that kind of thing?

Michael Tinetti:
Yeah. So if there's a loss in you know, four or five-unit building, like you mentioned, then what would first happen to claims submitted, and let's say it's through the master program. The carrier would reach out, get recorded statements from you all, talk to the residents, kind of understand what happened, basically do a full investigation, then what they'd also do, they'd also look at the surrounding units if there was damage there as well. They determine if there were other policies in place. And something to point out is if there's another you know, let's call it a State Farm policy in place on the same unit, for instance, that would be primary to the master policy in this situation. However, if it's in a neighboring unit, then what they would work to do the carriers. But by day, I mean, the carriers would work out and investigate where the fault lied or if it was partial thought fall on unit one versus unit two, they would have come to an agreement of some sort and determine who's liability wise where. And oftentimes they will even split the total cost between the two of those carriers if it is a split liability type situation. So if someone was enrolled under the master and was and really this isn't that common, but if for instance, they were somehow 30% liable versus 70% liable for Unit two, who was on State Farm, State Farm would pay 70% of that claim. And then the master program through Second Nature and get covered would pay the 30%. But ultimately it's tough to give a concrete answer because every claim is different and they will for the larger type losses, they will do a full investigation into each incident. They'll talk to the residents involved, talk to the property manager, get, you know, written statements and make sure that they fully understand what happened. And then with the fires and stuff like that, they'll also get the fire reports, you know, reports showing the cause and origin of the losses and whatnot.

Sam:
Yeah, so, so disturbed. And I think that's a great answer. So thank you for that. I guess my just a follow-up question again, my specific situation as a backup when starting it and it's three units that are all on top of each other units. And so there's no real major damage to any of the structures, no contents, no anything. But just the basement now has to have remediation because of the Blackwater. My question, though, so so thank you for answering that. I think I understood that. Is there ever a situation in which my owner because again, going back to what you all said, my hope, one of the ways that I'm literally going to be suggesting this would be to say, look, you had I have an example with a tenant that was putting salmon in products and or wipes down. We had three backups over the course of nine months. Each backup cost 1500 dollars if we had a master policy. And even if the tenant wasn't paying, if we now covered it now, you wouldn't have been out anything except for maybe a small deductible or whatever. So is there ever a situation in which if all tenants have some sort of policy in place or let's say one does have a policy because again, all this administrative burden that occurs that my owner is not going to now be made whole for whatever reason, right? Like I just. Have you ever seen an experience like this? I know you guys are based on amazing service, but I know State Farm's not based on amazing service. So is there ever a situation in which there is real damage that's done caused by a tenant of some sort and the claim is denied,

​​Michael Tinetti:
You know, assuming it falls under the covered perils that are detailed in the policy? No, that would not happen now if the resident didn't have insurance and they were the cause of the loss. So let's say I'm living in the middle unit and I was the one that was putting the foreign objects into the toilet and I didn't have a policy in place. Unfortunately, generally the master in this situation would not kick in because it wasn't caused by an insured or in an insured unit. However, if that resin that caused the loss was insured under the master or enrolled into this program, then it would be covered based on the way you describe that example.

Andrew Smallwood:
Great question. And I think it's even worth covering, Michael, just like, you know, a couple common you know, when you think about denied claims are perils that are not covered. I think about appliances, potentially not appliance backup you know, would be a good distinction from the actual appliances themselves. You know, maybe you could cover that as far as what's covered and not covered there.

Michael Tinetti:
Yeah, absolutely. And one of the questions I did see on the sheet here that were sent in previously was what is the coverage like and how is it comparable to big names like State Farm? So that's a very good question. And really, it comes down to how our master policies like this are different than ours, which is a standard renter insurance policy. And kind the main factor is that these are specifically tailored for property management companies, landlords, and owners to provide as good as possible, as good as possible. Liability protection from residents cause damage is whereas on the floor side it will be more expensive, but it's more tailored to resident benefits like the content limits and unique endorsements that they can add So that's just kind of a quick overview of kind of a difference between this type of program and a State Farm and that this is really tailored and designed for property managers and landlords like yourselves. As far as the common exclusions or common coverages, you're looking at the five major perils of fire, smoke, explosion, water, and overflowing sewer. Those are going to be included in any policy you see. But what makes this type of policy unique is that we're automatic including things like collapse, falling objects, freezing of pipes, overflow of appliances, you'd have a loss of rental income, pet damage. Bedbug remediation. Mold remediation. Those aren't items that would normally be included on a show floor, specifically because a resident isn't generally interested in paying an additional premium to get those included, but they are automatically included on this. The Second Nature offering. And then as far as kind of when they would take effect or apply, it's when the resident is negligent or liable for the loss. So, for example, if they fell asleep while cooking and caused a fire, that would be a great example of something that's covered. Now, to Andrew's point here, items that would not be covered would generally fall under situations where the resident wasn't legally liable. So let's say a natural cause, like a lightning strike caused a fire. The resident isn't negligent for that. That, unfortunately, would be excluded. Similarly, speaking flooding. Flooding is commonly exploited across all types of policies. If there is heavy rain that seeps into the home or unit, if a pool overflows because of a monsoon, if there's a hurricane tornado, those types of things would not be covered because they fall under the natural cause exclusion to kind of continue that down that path. You're looking at equipment breakdown type situations would also be excluded. If my ceiling fan had an electrical shortage or something like that and caused a fire, unfortunately, again, this coverage would not apply because I, as the resident, was not negligent or liable for that type of situation.

Andrew Smallwood:
And that's really my goal. You know, where the other side of this coin, the property investor or the property owners policy. Right, is something to look at and say, hey, there's opportunities for master policies nature will be looking at this ultimately as we have a lot of success on the resident side. You know, also, hey, how can we help property managers do the same thing? And that's a place for being added as an additional insured on the owner's policy. It's that it can be a real administrative battle for folks. And those policies generally are also much higher premiums on a monthly basis than a renter's policy because they cover the kind of things that you're just talking about. So, you know, that's really where you would see those items handled is going to be on an owner's policy as opposed to renters and residents policy where it's their liability and their issue Good, good, good, good. All right. Great questions. Listen, we budgeted a little time to go over we are over our scheduled time, but we've been raising money for Ukraine the whole time. We're up over $1,200 bucks. So that's great. Couple hundred more bucks here live. Thank you guys for your questions. This has been fantastic. Michael, I'd just like to say thank you again. Thank you to everybody who asked questions here today and participated. Thank you to Laura Mack, who makes all of this possible. Thank you to Carole Housel and the whole team that's going to take this in post-production. And we've got about, gosh, I don't know, 20 other questions that we still need to answer. We'll be doing that in the Triple Win Property Managers Group. Laura will drop a link in the chat of where you can go if you're not a member of that group. Listen, I'm on vacation here in Santa Rosa Beach, Florida. But if we're raising money for Ukraine, that's a that's a good use of vacation answering some insurance questions. So Michael and I will be in there posting some of your questions and answering them right in the feed so everybody can see them answered. Thanks again for everybody for your engagement today. Thanks for being with us. On America Wednesday. Hope you have a great rest of your day, a great week. Keep stacking and adding your time lens. Hopefully, we can help you make insurance one of those in the weeks to come here. That's it. Take care, everybody.

That's all for today's Triple Win Property Management Podcast Thank you so much for listening. Thank you so much for sharing a piece of your life with us. We do not take it for granted. I also want to give a shout-out to Carole Housel for everything she and our team does to make this possible. It's crazy to think about. Over 5000 professional property managers have pressed play on episodes in season one and season two now, and we really want to encourage you to keep giving feedback because more and more people are listening. It's getting better and better and better thanks to everything that you're sharing with us. If you liked this enough to listen, I want to encourage you to share it with other people. You can give us feedback directly on the social media channels, Facebook, LinkedIn, wherever you're hanging out. You can also send us an email at triple when it's like an intercom, and we just want to give more where there's no sales pitch here. Just want to offer more resources that help you find and start your next Triple Win and become a Triple Win-driven property manager. So where can you find that? You can find a private Facebook group. You can find our blog. You can find our newsletter to find more resources all at RV dot Second Nature dot com to search for what you're looking for there. And every time we see you, we want to see a better version of you and your business. To that end, Keep it going. Feel inspired. Take our encouragement and we'll see you next time.

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