Michigan’s Housing Law says units in a multiple dwelling are not to be occupied without a certificate of compliance, and Detroit’s amended ordinance makes it unlawful to collect rent without a valid one. The city presumes all paint in a residential rental is lead-based. Water that comes up through a floor drain and water that comes in from the street are two different coverages, and neither is automatic on a property policy.
What underwriters ask about a Detroit apartment building
- Certificate of complianceWhether the building has a current one from the Buildings, Safety Engineering, and Environmental Department (BSEED), and when it expires.
- LeadThe result of the lead part of the last rental inspection, and whether the building sits in an area the Health Department has marked high-risk.
- Basement and drainsWhat is kept below grade, whether the building took water in 2021, and what was done about it.
- Heat and occupancyBoiler age and service, who watches the building in January, and how many units are empty.
- Blight ticketsOpen violations and unpaid tickets, which the city can now turn into a lien on the property.
The coverage parts are the same as anywhere (how apartment programs are put together). A two-flat or a four-unit building may fit a landlord policy instead, but the city’s certificate applies either way.
The certificate of compliance and the 2024 ordinance
The city’s rental page explains the two layers. Under the Michigan Housing Law, cities regulate multi-family rental housing and can require a certificate of compliance before a unit is occupied; Detroit added its own ordinance for one- and two-family rentals. In October 2024 City Council passed an overhaul of the inspection process, and the city says the simplified process is now open to all properties.
- No certificate, no rent. Amended section 8-15-82 of the City Code says an owner must secure a certificate before lawfully allowing occupancy and collecting rent, and makes it unlawful to collect rent for any time there is no valid certificate. Tenants may pay into an escrow account instead.
- Term. A certificate runs three years, and can be extended to five when the building has been approved for two consecutive periods before expiration.
- One application. BSEED has combined rental registration and the certificate into a single step, with a standard inspection checklist the city’s summary describes as fifteen points.
- New owners. When a rental is sold, the new owner has to register it again.
- Penalties. Violations are blight tickets, and the 2024 changes let the city convert unpaid tickets into a lien enforced like delinquent property taxes.
State law points the same way. The Housing Law suspends the duty to pay rent, with the rent going into escrow, while a building has no certificate or its certificate is suspended, and a certificate is suspended at once if a reinspection finds a hazard to health or safety. A loss of rents claim assumes there was lawful rent to lose, so I ask for the certificate with the rent roll. Elsewhere in Southeast Michigan the same state law is enforced through each city’s own ordinance, so the paperwork changes at the city line.
Lead: what the amended ordinance requires
For rental inspections, the ordinance presumes that all paint on the interior or exterior of a residential rental property is lead-based, and treats any deteriorated paint as a violation. What the inspector does depends on where the building is:
- Outside high-risk areasA visual assessment for deteriorated paint and bare soil. If it finds a problem, the owner fixes it and the re-inspection adds dust wipe samples.
- Inside high-risk areasA visual assessment plus dust wipe samples at every inspection. The Health Department identifies these areas each year from children’s blood lead data.
- After a poisoningThe city’s summary says that when a child in a rental is lead poisoned, the owner will be ordered to complete and pay for a full lead inspection and risk assessment.
On the insurance side, many habitational liability forms exclude or limit lead claims. The underwriters who will look at an older Detroit building want the inspection results and proof that failed items were corrected, so send both.
What Michigan law puts on the landlord
- Fit premises and repair. In every residential lease the landlord covenants that the premises and all common areas are fit for their intended use, and to keep the premises in reasonable repair and in line with state and local health and safety laws.
- No signing it away. The Truth in Renting Act bars a lease clause that excuses the landlord from liability for failing to perform, or negligently performing, a duty imposed by law. It makes one exception: a release for fire or other casualty loss that the other party insures under a policy that permits the waiver and gives up the insurer’s right of subrogation.
- No local rent control. State law prohibits a city from enacting or enforcing an ordinance that controls the rent charged on private residential property.
The first two are why liability limits on a Detroit building should not be set by habit. A stairwell, a porch or a common hallway is the owner’s by statute, and the lease cannot move it to the tenant. Most owners I work with add a commercial umbrella over the primary limit.
June 2021: sewer backup and flood are separate coverages
On June 25 and 26, 2021, a storm stalled over the region. The independent review commissioned by the Great Lakes Water Authority found that the hardest-hit band, across southern Dearborn, the southern part of Detroit and the Grosse Pointes, received more than six inches of rain, with some areas over eight inches in 24 hours. Flows far exceeded what the combined sewer system was designed to carry, the report said, and Detroit received thousands of water-in-basement complaints, concentrated on the west side bordering Dearborn and on the east side. The storm became a federal major disaster, declared July 15, 2021, and FEMA lists more than 56,000 approved individual assistance applications.
For an apartment owner the lesson is in the policy wording:
- Flood is its own policy. Surface water from outside is generally excluded from commercial property forms and has to be bought separately. See flood insurance and the Michigan flood guide.
- Sewer and drain backup is an endorsement. Water that comes up through floor drains is usually excluded too, unless backup coverage is added, and the limit is often small compared with a basement full of boilers, electrical gear and laundry machines.
- What I ask. What is in the basement, whether there are backwater valves or a sump, and what the 2021 claim looked like.
Freeze, heat and empty units
Frozen pipes are a routine winter loss in Michigan apartment buildings, and they get worse when a building is partly empty. Property forms typically limit or exclude freeze and water damage once a building has been vacant for a stretch, unless heat was maintained or the lines were drained. If you are turning units or holding a building for renovation, tell me the occupancy honestly; a vacant building policy or builder’s risk may be the right form for that period. Underwriters also ask about boiler age and service records, and equipment breakdown coverage is how the boiler itself is insured.
When the standard market says no: Michigan Basic
The Michigan Basic Property Insurance Association is the state’s FAIR plan, in business since October 21, 1968. The Department of Insurance and Financial Services lists commercial property among the policies it can issue, next to homeowners, renters, condo and dwelling fire.
- What it is. The Insurance Code defines basic property insurance as direct loss to property under a fire policy with extended coverage and vandalism endorsements. It is property insurance, so liability has to be placed elsewhere.
- Qualified property. The property has to comply with building codes, and the statute uses the Housing Law as the minimum standard. Open code problems can keep a building out of the plan as well as out of the standard market.
- One location, one policy. The association says each property location must have its own policy, and applications go through an agent.
It is a floor for a building that cannot be placed otherwise, to be replaced once the certificate, repairs and loss record are in order.
What to send me
- Address, year built, stories and unit count, construction type and current occupancy.
- The certificate of compliance, its expiration date, and the last inspection report with the lead result.
- Open blight tickets or violations, and what has been done about each.
- System updates with years: roof, wiring, plumbing, boiler or furnaces.
- Basement details: what is stored or installed there, backwater valves, sump pumps, and any 2021 water damage.
- The current rent roll, a recent operating statement and current declarations pages.
- Five years of loss runs.
Common questions
Who insures apartment buildings in Detroit?
Standard and specialty insurers write them when the certificate of compliance, inspection results, building updates and loss history are in order. If the regular market declines, the Michigan Basic Property Insurance Association can provide basic property coverage, without liability.
Do I need a certificate of compliance to rent out an apartment in Detroit?
Yes. The city’s amended ordinance requires a certificate before an owner may lawfully allow occupancy and collect rent, and tenants in a building without one may pay rent into escrow.
How long does a Detroit certificate of compliance last?
Three years under the ordinance amended in late 2024. It can be extended to five years when the building has been approved for two consecutive periods before expiration.
Does my Detroit apartment policy cover sewer backup in the basement?
Usually only if backup coverage was added by endorsement, and often with a low limit. Check the wording and the limit against what is actually in the basement.
Do I need flood insurance on a Detroit apartment building?
Flood is generally excluded from commercial property policies and is bought as a separate policy. After the June 2021 storm it is worth pricing even away from the river, and a lender may require it in a mapped flood zone.
Does apartment building insurance in Detroit cover lead paint claims?
Often not. Many habitational liability forms exclude or limit lead, so read the wording and give the underwriter the lead results from the rental inspection.
Can Detroit limit how much rent I charge?
No. Michigan law prohibits local governments from enacting or enforcing rent control on private residential property. Detroit’s rental ordinance adds that nothing in its inspection section limits the rent an owner may charge.
General information about insuring rental apartment buildings in the City of Detroit as of November 2026, not legal advice. Rental registration, certificate of compliance and lead inspection rules, state landlord-tenant law and FAIR plan eligibility change; confirm your building’s obligations with BSEED and counsel, and read your own policy for flood, backup and vacancy terms. Coverage depends on underwriting and the terms, conditions and exclusions of the policy actually issued.