Why You Need to Add Your Property Manager as Additional Insured

Insurance is one of the most important and most misunderstood parts of owning a rental property. Many owners carry landlord insurance, assume they are fully protected, and do not think much about it until something goes wrong.

One small but critical detail often gets overlooked: adding your property manager as an additional insured. At Freedom Path Property Management, this is not just a recommendation. It is a requirement designed to protect everyone involved, especially you as the owner.

Here is why this matters and how it helps reduce risk in ways many owners do not realize.

What “Additional Insured” Actually Means

Adding your property manager as an additional insured means your insurance policy explicitly extends liability coverage to them for claims related to managing your property.

This does not replace your ownership or reduce your coverage. It does not transfer risk away from you. Instead, it aligns coverage so that if a claim involves management activities such as inspections, maintenance coordination, or tenant interactions, everyone is protected under the same policy.

Without this endorsement, coverage gaps can appear at the exact moment you expect protection.

The Real Risk Most Owners Do Not See

Many liability claims do not start with an obvious mistake. They often begin with routine situations that escalate unexpectedly.

Common examples include:

• A tenant slips on ice

• A contractor is injured while performing work

• A maintenance issue causes property damage

• A visitor is hurt on the premises

In many of these cases, both the owner and the property manager are named in the claim regardless of fault.

If your property manager is not listed as additional insured, their insurance carrier may seek recovery from you or your policy. This can create disputes between insurers, delay claim resolution, and increase your exposure.

Why Professional Property Managers Require This

Professional property managers require additional insured status because it creates clarity and alignment before a claim ever happens.

This requirement helps:

• Align liability coverage

• Prevent disputes between insurance carriers

• Speed up claims handling

• Reduce legal uncertainty

At Freedom Path, this requirement protects our owners just as much as it protects us. When coverage is clear and aligned, claims are handled faster and with fewer surprises.

How This Requirement Protects You as the Owner

Adding Freedom Path as additional insured helps protect you in several important ways.

It helps ensure defense costs are covered under your policy, reduces finger-pointing between insurers, and lowers the chance of uncovered claims. Most importantly, it strengthens your overall risk management strategy.

In simple terms, it closes a loophole that many owners do not know exists until it becomes a problem.

Coverage Levels Typically Required

Most professional property management companies require similar insurance standards. At Freedom Path, owners are typically required to carry:

• Landlord insurance, not homeowner’s insurance

• A minimum liability limit, commonly $500,000

• Freedom Path Property Management listed as additional insured

This endorsement is usually inexpensive and often added with a quick call or email to your insurance agent.

Common Misconceptions Owners Have

Many owners hesitate because of common misunderstandings.

Some believe their insurance already covers everything. In reality, coverage can be limited if the property manager is not named.

Others assume this requirement only protects the management company. In practice, it primarily protects the owner by ensuring aligned coverage.

Some worry it is expensive or complicated. In most cases, it is a simple endorsement with little or no cost increase.

Why This Matters More With Professional Management

When you hire a property manager, you are delegating authority. That delegation introduces shared responsibility in the eyes of insurance carriers and attorneys.

Professional property management involves inspections, vendor coordination, tenant communication, and enforcement of lease terms. These activities increase exposure if coverage is not aligned.

Requiring additional insured status ensures your insurance policy matches how the property is actually operated.

Freedom Path's Risk-First Approach

At Freedom Path Property Management, we take a proactive approach to risk. From insurance requirements to inspections, documentation, and vendor oversight, our systems are designed to protect your investment before issues arise.

Requiring additional insured status is part of that philosophy. It is not bureaucracy. It is smart protection.

This approach allows owners to operate with confidence rather than reacting after a problem occurs.

What Owners Should Do Next

If you already have landlord insurance, adding an additional insured endorsement is often straightforward. Your insurance agent can confirm whether your policy meets the requirement and make adjustments if needed.

If you are unsure, we are happy to review the requirement with you and explain what to ask your agent. This is a small step that can prevent major complications during a claim.

To Conclude

Rental ownership always carries some level of risk, but unnecessary exposure is avoidable. Adding your property manager as additional insured is a simple step that can prevent coverage gaps, delays, and costly disputes.

If you are considering professional management or want to confirm your insurance aligns with best practices, we are happy to help.

Visit www.freedompathpropertymanagement.com
Call (208) 676-5100