Aon has expanded availability to new states for its Aon Rent Protect product that reimburses landlords for lost income when tenants default on rent payments.
The product was initially launched in California, Colorado, D.C., Ohio and Pennsylvania, and it is now available in Arizona, Arkansas, Idaho, Michigan, Rhode Island, Tennessee, and Wisconsin. Coverage will soon be available in 50 states.
“Rent default coverage has been sold overseas for years, but has not been available in the U.S. until now,” said Kevin Madden, managing director of the Real Estate practice at Aon Risk Solutions. “We are excited to offer this crucial management solution to residential and multifamily property owners and managers.”
Traditional property and casualty insurance plans provide coverage for lost rent due to physical damage exposures such as fires and hurricanes, but they do not address the risk of tenant default.
“This is a game changer for anyone who owns or manages a residential rental property,” said Kevin Morman, senior vice president of program design and development at Aon Affinity. “When tenants default on the rent, it can take months for landlords to regain their property and seek out another tenant. Meanwhile, landlords must continue paying mortgage and additional expenses. Aon Rent Protect helps relieve this cash flow nightmare.”
The product is backed by the QBE Insurance Group and was designed to address all sectors of the residential rental property market, including individual property owners and large property owners.
The product will replace rental income for up to six months and offer assistance with legal expenses associated with the eviction process. Annual premiums start at $250 per rental unit.
There is a referral program available for property management and real estate companies with landlord clients that would benefit from the product.
Aon and QBE have provided tenant rent default insurance in Australia, the UK and New Zealand for the past 20 years. Aon Rent Protect is sold out of Hatboro, Pa.
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