By purchasing a series interest, an investor will be deemed to consent to the property manager obtaining insurance on the property. The premiums for insurance coverage will be deducted from annual distributions.
Insurance policies will cover property peril and potential damage resulting from fire & lightning, explosion, aircraft & vehicles, vandalism & malicious mischief, glass breakage, falling objects, theft, and smoke. The coverage will not cover potential items typically not covered by property insurance such as damage resulting from mold, power failure, neglect, seepage and/ or pollution, freezing, earthquake, government action or other damage typically not covered by property insurance. Insurance policies will also cover general liability. Any amounts the insurer doesn’t cover (e.g., deductibles up to $2,500 per event, although a higher deductible may be required by an insurance provider in some circumstances) will be deducted from the reserve or additional indebtedness may be taken.