A 14,000-unit multifamily REIT put every vendor COI behind a payment hold across two property systems

At a glance

After the REIT acquired a 14-community portfolio running on Entrata, it was tracking vendor insurance in two systems and verifying it in neither. Pikorua Security now reads every vendor certificate and endorsement, writes status back to both systems and holds payment automatically on any vendor that falls out of compliance.

The challenge

Multifamily vendor risk is spread thin. A single community may use 40 vendors, each with a different scope, and the business manager who collects their certificates is also leasing units, processing renewals and closing the month. The REIT's vendor services agreement required general liability limits of $1,000,000 each occurrence and $2,000,000 general aggregate, the REIT and its property management entity as additional insureds on a primary and non-contributory basis, waivers of subrogation, auto liability for any vendor driving on property, and workers compensation for any vendor with employees.

None of that was checked below the expiration date. When the Director of Property Operations sampled 60 vendor files after the acquisition, 19 listed the community as certificate holder with no additional insured endorsement attached, and 11 had already expired. The vendor master in Yardi Voyager carried one insurance expiration date per vendor, typed in by hand, so a vendor with a current general liability policy and a lapsed workers compensation policy looked compliant.

The 14 Entrata communities had their own process and their own spreadsheet. Regional managers had no way to see, across the portfolio, which vendors were approved, which were deficient and which were being paid anyway. Then a landscaping vendor's employee was injured on a mower at one community while the vendor's workers compensation policy had lapsed, and the REIT spent months defending a claim the vendor's insurance should have answered.

What changed

Pikorua Security mapped the vendor services agreement into two rule sets: a standard vendor set and a high-risk set for roofing, elevator, tree work, pool service and any vendor working at height. The standard set runs 22 rules, including CG 20 26 or blanket additional insured wording naming both the REIT and its management entity, CG 20 01 for primary and non-contributory, CG 24 04 and WC 00 03 13 for waivers, CA 04 44 for vendors with auto exposure, and an AM Best rating of A- VII or better.

Vendor records came from both property systems: Yardi Voyager for the 38 legacy communities and Entrata for the 14 acquired ones. Pikorua Security de-duplicated 210 vendors that served communities on both systems, so a regional HVAC contractor has one compliance record no matter which community calls it out.

Every vendor then received a request for its current certificate and endorsements through a zero-login upload link, copied to its insurance agent. Pikorua Security read 1,140 vendor packets in the first three weeks and routed 412 deficiencies back to vendors and agents automatically, each listing the exact form or limit missing and the agreement section that requires it.

Enforcement runs through the property systems. In Yardi Voyager, Pikorua Security writes coverage expiration dates to the vendor record and sets the vendor's payment hold when a certificate is deficient or expired. In Entrata, the vendor's compliance status updates so site teams see it before they assign a work order. Holds release on their own when the corrected document verifies.

Results

At go-live, 31% of active vendors had at least one open deficiency. Ninety days later the figure was 4%, and every vendor still in that group was on a payment hold rather than being paid. Expiring vendor certificates, which used to surface during audits, are now flagged at 60 days and chased at 60, 30, 15 and 0.

Average resolution with vendors' insurance agents fell from 28 days to 4.2 days. Business managers no longer handle certificates at all, and the Director of Property Operations estimates 2,900 hours a year returned to community staff across the portfolio.

The REIT's insurance renewal submission now includes a portfolio-wide vendor compliance export from Pikorua Security showing verified additional insured status, waivers and carrier ratings for every vendor. The risk team pulls the same export whenever a resident or guest claim involves a vendor's work, so the tender to the vendor's carrier goes out with the evidence attached.