We carry the standard liability insurance for our park, and we insure the few homes that the park owns. We also have started requiring that all new tenants insure their homes. However, I don’t have any good way of enforcing that tenants have insurance, and I’m fairly sure some of the older/original tenants don’t bother to carry it.
So here’s what concerns me: If there’s a tornado, major storm, or fire that damages multiple homes, then I could see myself left holding the bag. Obviously, for those with no insurance I’m out the lot rent and I’m faced with the responsibility of filling those lots. Even for those with insurance, who’s to say they won’t just take the money and run, again leaving me with the empty lot?
A great opportunity to bring in new homes, you say? My margins and reserves are so low in my 22-pad park that I could not cover multiple total losses. Yes, I could endure having a few lots down, but it would take a long, long time to get multiple lots filled.
I would really like some sort of insurance to cover a multiple catastrophic losses. In talking with insurance providers, the problem is that they don’t want to cover homes that I don’t own.
What is the best way to cover this kind of situation, no matter how unlikely it might be to occur?