How to calculate insurance when analyzing deals

Question

Kind of a rookie question but is there a site or a universal formula to estimate insurance when analyzing deals other than contacting a insurance agent in the specific market?

Joe Funari · Answer

@Palani Wright It depends on the state your looking in. Not all insurance agents work in all states either. But here on BP you can request landlord insurance recommendations for specific market. But here in the Dallas/Ft. Worth market a good rule of thumb for new investors I recommend annual landlord insurance at $1200 per year. Again, this is a general rule when calculating a deal. But once you get a property under contract an good insurance carrier can get you a firm quote pretty quick.

Jerome Morelos · Answer

Your best bet would be to call an insurance agent and ask for a quote. They'll ask you some questions about the property, but it doesn't take much work at all. I was using $1.50/sq foot as a rough estimate (I think I heard it from Meet Kevin). My quote ended up at $1770/year on my property here in California.

Eric Goldman · Answer

I always estimate 1200 for a SFH. could be more could be a bit less.

Joshua Noth · Answer

Like @Joe Funari said, every property/market can and will be different.  Generally speaking though, the $100/month estimate is a decent placeholder for running numbers!

Mauricio Sandoval · Answer

Thank you for this information! I truly appreciate it.

Palani (Pono) Wright · Answer

@Joe Funari Thank you

Shango Collier · Answer

Thanks for this info, used for deal analyzing and will be calling agency to get a quote just to see how close these numbers are/aren't.

Wale Lawal · Answer

I would call and ask for quotes in your area. When analyzing deals I normally calculate $90-$100 per month here in the Houston area!

Eliott Elias · Answer

Call insurance agents to give you quotes. They usually run around $1400 a month

Brittny Kenaley · Answer

@Mauricio Sandoval

I was getting extremely high insurance quotes for our properties in Ohio, then I realized after reading forums on BP that you have to ask them to quote you on Actual Cash Value, not rebuild cost (which are extremely inflated during these times of supply issues). Some insurance agencies may push back or need to insure for slightly above ACV, but you will still be saving a good bit going that route.

How to calculate insurance when analyzing deals

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