January 02, 2013

Loss Protection: Documented Inspections and Risk Transfer

How can a Manufactured Housing Community help protect themselves from losses that increase premiums?   Documented Inspections, and Risk Transfer through certificates of insurance are two easy solutions.

Documented Inspections:

Park managers regularly documenting inspections that note the condition of their community, can be an effective form of protection. We have all seen or heard of slip-and-fall claims where the community owner knows the claim is fraudulent however the insurance company pays the claimant some portion of or all of their demands.  The insurance carrier usually states that they had a lack of documentation to deny the claim.  If Park Managers have consistently documented the condition of the park and they can see that the alleged condition is not a hazard, the insurance company will be in a stronger position to deny the claim.  If they can deny the claim, it will protect the loss ratio that can drive premiums up and send a message to others that a fraudulent claim will not be paid.  At Propel Insurance we have worked with ProSight to develop a form for communities to easily document the condition of their park.

Risk Transfer:

The second way a community can protect itself from claims is to transfer risk.  A community transfers risk by obtaining properly executed insurance certificates from contractors doing work in their communities.  When a contractor works in a community, someone can allege that they were injured due to the contractor’s work or equipment.  If the owner or manager obtains a certificate of insurance from the contractor that names the park as an additional insured, the manager can pass the claim to the contractor’s insurance carrier.  Amd, the contractor’s insurance carrier will be required to defend the community.

We at Propel can provide a sample certificate and draft of a letter that community managers can send to contractors to request the certificate.  We also suggest reviewing contract language with your attorney to make sure they have not contractually tried to pass the risk back to the community.

We at Propel appreciate the opportunity to work with so many fantastic communities.  We provide all insurance products needed to protect a manufactured housing community.

If you would like copies of our inspection form or sample of certificate and letter to send to a contractor please email us and we will get them to you right away.