Loss of Low Income Housing Tax Credit Coverage
Insurance Coverage Available to Help Protect Your LIHTC Property
What Is Available?
We understand the challenges that come with real estate development deals, which is why we developed the Loss of Low Income Housing Tax Credit (LIHTC) coverage. This optional endorsement, made available through Housing Enterprise Insurance Company, Inc., expands the definition of business income to include your investor’s loss of tax credits.
- Coverage is scheduled by building
- Limits are based on the actual loss credit at risk in that calendar year
- Coverage is triggered by a covered loss that causes damage to the insured building
- A covered loss also includes costs associated with changes in ordinances or law
What Can Occur?
If you suffer an insured loss, one that impacts the number of units you can bring back online, this can result in the IRS charging your investor, looking for reimbursement of tax credits in that calendar year. This coverage is designed to follow IRS rules, and if the federal government declares an irrecoverable loss based on fewer units, the Loss of Low Income Housing Tax Credit coverage form will provide reimbursement up to the limit provided, for tax credits lost in that calendar year.
Don’t let the potential loss of tax credits get added to the list of things that keep you and your investors up at night. Discuss the insurance implications of your Rental Assistance Demonstration (RAD) and LIHTC developments, and get the protection you need to support the investments you’ve made in your financial future.
Who Is Eligible?
Affordable housing owners, developers, general partners, and limited partners with property policies written through Housing Enterprise Insurance Company, Inc. are eligible.