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Message
Vacation rental protection from liability
Posted on 12/29/15 at 10:48 pm
Posted on 12/29/15 at 10:48 pm
I own a single family home that we will be listing for short term vacation type rentals.
In order to protect from liability, would it be best to establish an LLC or simply purchase an umbrella policy. Property is in South Carolina.
Wife and I are currently listed on the mortgage.
In order to protect from liability, would it be best to establish an LLC or simply purchase an umbrella policy. Property is in South Carolina.
Wife and I are currently listed on the mortgage.
3
Posted on 12/30/15 at 12:55 am to geauxtigers8482
Not a legal expert, but I would do an llc.
Posted on 12/30/15 at 2:50 am to geauxtigers8482
Are you doing the vacation leasing? Actively involved in management? Are you doing repairs and maintenance?
If you are - everything I have been told is you can't really get away from liability and therefore what's the true point of an Llc?
Also , several times I've heard llc's just complicate tax filings, but I can understand their points on enabling ease of transfer of ownership.
I just have umbrella policy over everything. If someone sues don't they generally sue everyone - landlord/owner, and property manager anyway? The umbrella policy covers that.
That's my perspective on it.
If you are - everything I have been told is you can't really get away from liability and therefore what's the true point of an Llc?
Also , several times I've heard llc's just complicate tax filings, but I can understand their points on enabling ease of transfer of ownership.
I just have umbrella policy over everything. If someone sues don't they generally sue everyone - landlord/owner, and property manager anyway? The umbrella policy covers that.
That's my perspective on it.
Posted on 12/30/15 at 8:47 am to geauxtigers8482
quote:
In order to protect from liability, would it be best to establish an LLC or simply purchase an umbrella policy.
I would just get an umbrella. minimum $1,000,000. that would give you $1,300,000 in limits when you add the primary.
I personally think you should get a 2 or 3 million umbrella.
I have two multi unit rental properties and do not have them in an LLC because we co-mingle the funds. I understand insurance very well and not so much legal, but my basic understanding is that if i REALLY wanted to be protected by an LLC i would need to make sure those funds from rental, etc, stay completely outside of my day to day life.
Plus, with an umbrella, you are also extending numerous additional coverages over yourself from auto, personal & advertising, etc.
Posted on 12/30/15 at 11:05 am to eng08
We have a property management company that will be handling all of this.
Posted on 12/30/15 at 11:07 am to Mr.Perfect
Thanks, our intent would be to use profits to pay the mortgage off early. The interest rate is relatively high.
Posted on 1/1/16 at 7:08 pm to Mr.Perfect
Mr.Perfect,
In re: insurance, this is a single family home. It looks as if typical homeowner's insurance won't cover "business" activities. Sounds as if short term rentals are business as opposed to long term rentals, which our current policy does cover.
What type of insurance concerns should we have if we go this route?
In re: insurance, this is a single family home. It looks as if typical homeowner's insurance won't cover "business" activities. Sounds as if short term rentals are business as opposed to long term rentals, which our current policy does cover.
What type of insurance concerns should we have if we go this route?
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