Owners of Rental Properties Need to Be Prepared in Today’s Litigious Society

Why you should consider creating an LLC for your rental property

By: Edward L. Blais, JD, CIC

President, Blais Insurance

As we move through life, we all try to accumulate wealth along the way. Possible sources may include investments, retirement funds, and perhaps equity in rental properties. Throughout this process, we need to protect our assets and perhaps even more importantly, contain liability exposures that could result in claims against our life time accumulations.

Rental properties present special concerns since claims for personal injury can result from even the most meticulously maintained properties.  Often times, it is what tenants do or don’t do, that result in a claim against the property owner by persons the tenants invited onto the premises.  If the property is owned in the individual name(s) of the property owner(s), then all of their assets – not just that rental property itself – may be in jeopardy in connection with a lawsuit against the property owner(s). 

Insurance doesn’t have to be the only line of defense against such claims, nor should it be.  Homeowners should consult with an attorney and explore the prospect of transferring their ownership of a rental property to a Limited Liability Company (LLC).

If you are looking to protect your assets through this strategy, after consulting with counsel, consider calling Blais Insurance at 401-725-0070 to make sure you have the proper insurance coverage needed.

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