Corey Allison (pictured), executive vice president and head of Amwins’ national casualty practice, spoke in depth about the complexities of general liability and umbrella insurance for multifamily properties, particularly in the low-income housing sector.

Talking to International BaccalaureateGeorgia remains one of the most difficult states to secure liability coverage for multifamily residences, with large A&B accident judgments a major contributor, Allison said. The need for creative solutions has never been greater. One significant challenge in this area is managing the increasing deductibles that insurance companies charge on a de minimis basis rather than on a set account basis.

“We’ve been working on a more diverse approach to retention,” he explained. “If you have locations that require much higher retention, say $250,000, we try to reduce that retention in other locations. We don’t want the minority to negatively impact the majority.”

“I take pride in providing the important details.”

The cornerstone of Allison’s approach is to go as deep as possible to provide insurers with the clearest possible picture of risk.

“I pride myself on providing the important details and removing information that doesn’t provide any value,” he said. “If you tell an insurance company that you spent $1 million on improvements to a site, that doesn’t provide the same value as a detailed list of the actual work that was done.”

In his native Georgia, the scene has changed dramatically.

“Five years ago, you could get basic coverage,” Allison recalls. “Now, many insurance companies require coverage between $50,000 and $100,000, regardless of risk characteristics. Insurers that offer lower coverage often offer sub-limits for assault and battery.”

According to Allison, the use of AI by carriers to scan addresses for past incidents adds another layer of complexity. Carriers will use AI to pick up negative keywords like “assault” or “shooting” from online sources. Carriers do this to see if there may have been an incident that didn’t show up in the loss log, which could be because the owner bought the property after the loss occurred.

“Bad reviews and negative keywords online can impact the underwriting process even if improvements have been made to the property,” Allison noted.

Degrees of crime in subscription

Delving into the specifics of the challenges of securing low-income housing, Allison said educating insurers about different types of subsidized housing, such as Section 42, is crucial. “Section 42 may be better than traditional apartments because the government monitors them and ensures that the buildings are in good condition to continue receiving tax credits,” he said.

The use of crime scores in underwriting has also become a critical factor. “Crime scores, which range from 0 to 100 with a national average of 20, are now a standard part of underwriting,” he added. “Even if a property has a significant loss history, a high crime score can result in higher premiums or denial of coverage.”

“If a property has a high crime rate but they have invested heavily in security upgrades, those changes should be factored into their risk assessment,” he argued. However, the industry’s reliance on crime scores and AI-generated data could unfairly penalize property owners who actively work to improve safety.

“Transportation companies are becoming increasingly cautious about the legal environment in Georgia.”

While Georgia is considered one of the best states to do business in, Georgia has also been named the number one judicial hellhole for 2022 and 2023 by Georgia – Judicial Hellholes. “Carriers are becoming increasingly wary of the legal environment in Georgia, leading to higher premiums and more exclusions,” Allison explained. “Meaningful change is needed, but it will take time and a multi-year process to address all the different opinions on what to do.”