CRM Risk Management & Safety Practices 3 — Questions and Answers
Question 1: A resident's guest is injured by a poorly maintained gate. Who is most likely liable for the injury?
- The resident who invited the guest
- The property owner and/or management company (Correct answer)
- The guest, because they were not a resident
- The contractor who last serviced the gate
Correct answer: The property owner and/or management company
Property owners and managers have a duty of care to maintain common areas in a safe condition for residents, guests, and invitees.
Question 2: Which of the following is a key element of a successful risk transfer strategy in residential property management?
- Eliminating all property amenities to reduce exposure
- Requiring contractors to carry adequate insurance and name the owner as an additional insured (Correct answer)
- Refusing entry to high-risk vendors
- Increasing security deposits to cover potential damages
Correct answer: Requiring contractors to carry adequate insurance and name the owner as an additional insured
Requiring certificates of insurance with additional insured status transfers the financial risk of contractor-caused losses to the contractor's insurer.
Question 3: Lead-based paint disclosure requirements under federal law apply to residential properties built before which year?
- 1968
- 1978 (Correct answer)
- 1988
- 1998
Correct answer: 1978
Federal law (TSCA Title IV) requires disclosure of known lead-based paint hazards in housing built before 1978, when lead paint was banned for residential use.
Question 4: What does 'assumption of risk' mean in the context of residential property liability?
- The property manager accepts full responsibility for all injuries
- A resident knowingly accepts the inherent dangers of a voluntary activity (Correct answer)
- The insurance company assumes all claims risk
- The property owner transfers risk to the management company
Correct answer: A resident knowingly accepts the inherent dangers of a voluntary activity
Assumption of risk is a legal defense where the plaintiff voluntarily engaged in an activity knowing its inherent dangers, which can reduce the defendant's liability.
Question 5: A fire suppression system inspection reveals several sprinkler heads need replacement. The property manager should:
- Schedule repairs within the next annual inspection cycle
- Document the finding and schedule immediate repairs to maintain system integrity (Correct answer)
- Notify residents the system is temporarily offline
- Replace only the most visibly damaged heads to control costs
Correct answer: Document the finding and schedule immediate repairs to maintain system integrity
Fire suppression system deficiencies must be corrected promptly because a compromised system endangers lives and may void insurance coverage.
Question 6: Which federal agency establishes workplace safety regulations that affect property management employees performing maintenance?
- HUD (Department of Housing and Urban Development)
- OSHA (Occupational Safety and Health Administration) (Correct answer)
- EPA (Environmental Protection Agency)
- FTC (Federal Trade Commission)
Correct answer: OSHA (Occupational Safety and Health Administration)
OSHA sets and enforces workplace safety standards that apply to maintenance staff performing tasks such as electrical work, confined space entry, and hazardous material handling.
Question 7: A property manager discovers that pool chemical storage does not comply with local fire code. The BEST immediate action is to:
- Continue using the current storage method until lease renewals
- Correct the storage violation immediately and document the corrective action (Correct answer)
- Notify only the insurance carrier of the non-compliance
- Close the pool facility permanently to eliminate the risk
Correct answer: Correct the storage violation immediately and document the corrective action
Non-compliant chemical storage is a fire and safety hazard that must be corrected immediately; documentation protects the property from liability.
CRM Risk Management & Safety Practices 3
A resident's guest is injured by a poorly maintained gate.
Who is most likely liable for the injury?