An owner with a thirty-unit building in Miami has two proposals on his desk. The premiums are within a few hundred dollars of each other. He is ready to sign the cheaper one, and on the surface there is no reason not to: both show the same building limit, both show a million dollars of liability, both say windstorm is included.
The difference is on pages four and seven. One settles roof claims at replacement cost; the other depreciates the roof. One carries a three percent named storm deductible; the other carries five. One includes twelve months of loss of rents; the other includes six. On a bad day those three lines are worth more than the entire annual premium, in the wrong direction.
This is what comparing apartment insurance proposals actually looks like. Here is how to do it line by line.
1. Are the Building Limits Even the Same?
Start here, because if the limits differ, nothing else compares cleanly. A proposal showing a lower building limit will always look cheaper, and it is not a better deal, it is less insurance.
Check three things on each proposal: the building limit itself, the valuation basis, and whether coinsurance applies. Replacement cost and actual cash value are not the same coverage, and a coinsurance requirement means a limit set too low reduces payment on every partial claim, not just a total loss.
If one proposal used a different valuation method to arrive at its number, ask which one reflects what it would actually cost to rebuild the building today. Our article on replacement cost versus market value covers how that number should be built.
2. Convert Both Wind Deductibles to Dollars
Named storm deductibles are stated as a percentage, which makes them easy to skim past. Two percent and five percent look like a small difference on paper. On a multimillion-dollar building they are separated by a number most owners would need financing to cover.
Do the arithmetic on both proposals and write the dollar figures side by side. Then check whether each applies per building or per occurrence, because on a property with multiple buildings that distinction can multiply the number.
A cheaper premium bought with a higher wind deductible is not a discount. It is a transfer of risk from the carrier to you, and it may be the right trade, but it should be a decision rather than a surprise.
3. Find Out How Each One Settles a Roof Claim
This is the single most common place two Florida proposals diverge while looking identical on the summary page.
One policy may pay roof claims at replacement cost. Another may settle the roof at actual cash value, deducting depreciation for its age, while the rest of the building stays on replacement cost. A third may add a cosmetic damage exclusion that declines to pay for dents and marring that do not affect function, or a roof schedule that reduces payment based on age.
None of this appears in the premium. It appears in the endorsements, and it decides what a wind claim is worth. Ask for it specifically on both proposals.
4. Compare the Water Damage Language, Not Just the Presence of Coverage
Water is the most frequent habitational claim, and it is where forms differ most quietly. Look at how each proposal handles repeated or long-term leaks, drain and sewer backup, and gradual seepage, and whether any water-related sublimit or deductible applies.
On an older building, check whether either carrier has attached conditions tied to the plumbing, such as a requirement for repiping or a higher deductible on water claims until the work is documented.
5. Line Up the Loss of Rents Limits and Periods
Two proposals can both say “loss of rents included” and mean very different things.
Compare the limit against your actual rent roll, not last year’s. Compare the period of restoration, because twelve months and six months are a meaningful difference in a state where a post-hurricane rebuild routinely runs longer than the construction estimate. And check for waiting periods and any extended period after reopening.
For an owner whose mortgage depends on the rent, this is often the line that matters most, and it is rarely the line anyone compares.
6. Check Which Parts of Ordinance or Law Each One Carries
Ordinance or law comes in three parts: the value of the undamaged portion that must be demolished, the cost of demolition and debris removal, and the increased cost of construction to meet current code.
Many policies carry the first and little of the other two. On an older Florida building, that gap is the difference between rebuilding and not. Ask each proposal which parts are included and at what limits, and do not accept “ordinance or law is included” as an answer.
7. Compare Liability Limits Against the Property, and Check the Exclusions
Liability limits should reflect the property’s size, amenities, and foot traffic. A six-unit building and a two-hundred-unit community with a pool, elevators, and a parking garage are not the same exposure.
Then check the exclusions, particularly assault and battery, which is where negligent security claims land and which many habitational policies exclude or sublimit. A proposal with an attractive premium and an assault and battery exclusion is a different product from one without it, especially at a property with security concerns or late-night activity.
If either proposal includes an umbrella, confirm what underlying policies it sits over and remember that it generally follows their exclusions rather than fixing them.
8. Confirm What Is Scheduled, Building by Building
Compare the schedules, not just the totals. A proposal may cover the residential buildings while omitting the leasing office, clubhouse, maintenance building, fences, gates, or signage. After a hurricane those are frequently what gets damaged.
Also confirm both proposals list the same named insured, meaning the entity that actually holds title, and the same mortgagee and loss payee wording your lender requires.
9. Ask Whether Each Carrier Is Admitted, and What That Means Here
Habitational is a hard class in Florida, and some of these placements are in the surplus lines market. A surplus lines policy is often the only realistic option, and it is not a lesser product, but it comes with differences worth knowing: it is not backed by the Florida Insurance Guaranty Association, rates and forms are not approved by state regulators, and fees and taxes are added to the premium.
Compare the total cost including taxes and fees rather than the premium line, and ask about the carrier’s financial rating and its actual experience with Florida multifamily claims.
10. Make Sure Both Proposals Describe the Same Building
This is the last check and the one that invalidates everything above if it fails. Confirm both carriers were given the same information: the same roof age and replacement year, the same plumbing and electrical history, the same unit count, occupancy, amenities, and loss history.
A proposal priced on incomplete or optimistic information is not cheaper. It is a policy written around a building that does not exist, and the correction arrives at inspection or at the claim.
What to Ask For Before You Decide
If you have two proposals and cannot tell them apart, ask each agent for the same short list:
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The building limit, valuation basis, and any coinsurance requirement
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The named storm deductible in dollars, and whether it applies per building or per occurrence
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How roof claims settle, and whether any cosmetic damage exclusion or roof schedule applies
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Any water damage sublimits, deductibles, or plumbing-related conditions
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The loss of rents limit, period of restoration, and waiting period
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Which parts of ordinance or law are included and at what limits
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Liability limits, and whether assault and battery is covered, sublimited, or excluded
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The full schedule of buildings and structures
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Whether the carrier is admitted or surplus lines, and the total cost with taxes and fees
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A copy of the schedule of forms and endorsements for each
That last item is the one that answers most of the others. The declarations page tells you the limits. The endorsements tell you what the policy actually does.
The Bottom Line
A cheaper policy that leaves a gap is not cheaper. It has moved the cost from the premium to the claim, and the claim is where it gets paid in full.
If you have competing proposals in front of you, we will read both against each other and tell you what the differences actually are, including on a policy we did not quote. Contact Prestige Insurance Group:
Miami 305-969-8776 · Orlando 407-993-2331 · Stuart 772-247-3788
Se Habla Español.
Related Reading
This article is for general informational purposes only and is not legal advice. Policy forms, endorsements, and deductible structures vary by carrier; refer to each proposal’s policy forms and endorsements for the terms that would apply to your property. Prestige Insurance Group, Florida agency license L057894.
