Societies around the world are standing up and saying ‘NO’ to discrimination. Greater awareness and sensitivity around the notion of equality is having a huge impact in the commercial sector, and decision makers are having to think twice before enforcing policies that may be considered by some as discriminatory.
According to the Fair Housing Alliance 2018 Annual Report, a huge 87.4% of housing discrimination acts reported in 2017 occurred during rental transactions. Even if a claim is frivolous or groundless, property owners and managers must defend themselves against the claim – and there are insurance products to help with that.
Specialty insurance provider and Lloyd’s coverholder NAS Insurance offers a tenant discrimination policy to protect property managers, property owners and anyone else who influences a decision around the leasing of real estate properties, whether they be apartments, homes, commercial spaces and so on.
The primary purpose of the coverage is to protect against allegations of discrimination under the Fair Housing Act, which prohibits discriminatory decisions around race, gender, disability, religion, sex, familial status, national origin and so forth. NAS’s standalone tenant discrimination policy goes a step further to provide insureds with training and consulting around best practices, as well as coverage for any fines and penalties that might be imposed upon them.
“Tenants today are very aware and sensitive to their treatment with regards to sexual orientation, familial status and so on. These things are very highly acknowledged and it’s important for property managers and owners to understand that,” said Tameka Livatino, AVP, specialty underwriting, Midwest Region, NAS Insurance.
“Brokers will find that a lot of their prospective insureds [property managers and owners] have either been threatened with a discrimination allegation or will know someone who has. Therefore, it’s important for brokers to realize that this coverage exists and that it’s a great cross-sell opportunity alongside other products like property insurance, property managers’ E&O, D&O and EPLI.”
Livatino will be co-hosting NAS’s exclusive webinar ‘Tenant Discrimination Insurance - Protecting Property Managers and Owners’ on November 14, in which she will present the NAS tenant discrimination policy and explain how testing by national and local fair housing organizations may affect policyholders.
“We often find that property managers or owners don’t intend to discriminate. What happens is, they impose a rule or a regulation on their property, which is perceived by a tenant as discrimination. Those types of claims have to be defended even if it was not the insured’s intent to discriminate – and the proceedings can be very costly,” Livatino told Insurance Business.
“As well as our standalone tenant discrimination policy, we also write property managers’ E&O and we write the discrimination piece into that. Quite frankly, the discrimination portion of the property managers’ E&O is where we see the most claims. If you own or manage a property and your evaluation process is considered discriminatory in any way, a claim can be filed, leading to a costly defense process.”
As well as looking at the NAS tenant discrimination policy, the upcoming webinar will also introduce NAS’s new employment practices liability product and discuss how property managers and owners can benefit from both the coverages together.
“These two coverages together will cover the full spectrum of what could be going on at a property management company with regard to discrimination allegations,” Livatino commented. “The tenant discrimination protects against allegations from prospective or current tenants, whereas the EPL protects against allegations from employees.”
Information Provided by: Insurance Business Magazine