Insurance For Rental Property
Good day to All: I have (2) 2 family, (4) SFH, and (1) 4 family all insured. My question is this; My 4 family is costing me 5x the rate of the others. Agent first said that I went over the Carrier's limit for # of properties, then said the cost was due to the fact that it was a 4 family, so I had to purchase a commercial policy. I don't know what is up, any help? Also, is it possible to change carriers for my future purchases and retain similar rates as I enjoy now? All of my propertie's premiums are 400 -500 per year. Is there anyone experiencing similar rates? I was told by an agent that my policies (Fire/Dwelling) are no longer being written. Any truth there? I appreciate any assistance that you all can provide.
Seize the day! Make $$$$$$$$$
For myself - insurance has been the single most time consuming and annoying part of being a landlord.
In FL it is getting increasingly difficult to get Hazard/Landlord/DP3 policy for any house over 25 years of age. And the coverage provided has many exclusions, is written by a sub-standard company, and the agent's office is fully of idiots. (Sorry but my experiences have been really bad.)
I get a DP-3 policy with 300,000 liability and the highest deductable possible. After all, who in their right might would actually file a claim. I pay about $350-400 per year.
Brenda
Thanks for your reply. How many properties are insured that way? Are they all SFH?
Just my 2 cents...
You get that for which you pay. If you want "cheap" coverage, expect "cheap" protection. It is difficult, if not impossible, to compare insurance situations in different areas, let alone different states. Many variables determine the rate. Insurers consider things such as: construction, age, credit history, fire protection-class, claims history (you and the property), etc., etc., etc...
Also, be wary if you extend your liability coverage from your home. You put not only your personal insurance at risk, but also your personal assets.
Check into a higher deductible, say $2500 or even $5000. Use the deductible as a cost-savings mechanism, not denying or shortchanging the policy itself (and potentially you in the process).
The best "rate" usually doesn't equate to the best, or even the proper, coverage. Work with an Agent that is familiar with the RE profession, Independent or not.
I also wrote an article re: insurance issues that may help. If you have any questions, feel free to PM me. I am in OH also, so have a good feel for what you are experiencing. Tim
5x a SFH for a 4unit seems aweful pricy. Shop around. Call some local realtors/investors for insurance agents they'd recommend. I have a 4unit in NC where our rates have sky-rocketed the last few years due to some hurricanes, etc...and I'm able to get good rates. It did take some calling around though.
Q
I understand all the criteria that makes up the rates. My post was not designed to get the lowest rate out there, it was posted to see if I am being told the truth. It did bring to my attention the fact that my deductables are too low. Currently each of my properties are insured for ACV (replacement cost), with a 250 ded, and 300K of liability and 3K of personal property. I guess, I should look at increasing my ded. Thanks - Tom
Quote:
On 2004-01-22 11:14, tclifford10 wrote:
I understand all the criteria that makes up the rates. My post was not designed to get the lowest rate out there, it was posted to see if I am being told the truth. It did bring to my attention the fact that my deductables are too low. Currently each of my properties are insured for ACV (replacement cost), with a 250 ded, and 300K of liability and 3K of personal property. I guess, I should look at increasing my ded. Thanks - Tom
Tom,
Make sure you are clear on what type of coverage you have.as ACV and Replacement Cost are two different things:
http://www.thecreativeinvestor.com/modules.php?name=News&file=article&sid=438
Thanks norrist,I was reading several policies and all the terms got all in there. On my rental properties, I have a Limit of Liability for the dwelling of $xxx,xxx for each property, with "Inflation " protection. Thanks for the heads up
Tim from Fairfield, OH. I would be interested in getting a copy of your article on RE investment insurance helps. How would that happen?
MarketSolutions,
Click the link 2 posts above. It should take you to it. PM me if you have any questions. Hope it helps. Tim