Insurance for flips?

4 Replies

I'm currently closing on my first flip house. Its a 1350 sq ft single family home in the Houston area and needs mostly cosmetic work. My hard money lender requires I have homeowner insurance so I started by getting a quote from my agent for my primary residence policy. He is offering a "Vacant Property Quote" which covers 80% of the ARV (ARV is 130,000) for the dwelling and $300K liability, 3 month term and it is fully earned, for almost $800.

This is my first flip, but this seems pretty expensive to me for a 3 month policy. Can anyone let me know if I'm looking at the correct type of coverage for a flip, and can anyone in the Houston area comment on the cost? Thanks!

I have used builders risk policies before. They are short term and not cheap. If you are using private or hard money you need to bite the bullet and pay up. Always better to safe than sorry.

@Jason Baehr I can only comment on our requirements, but Sherman Bridge Lending requires a vacant dwelling policy.

I could be wrong, but my understanding is that a builder's risk policy only covers you during the construction / rehab phase, but not during the marketing phase; whereas, the vacant dwelling policy will cover you as long as no one is occupying the property.

I have a few insurance contacts; feel free to message me if you need / want a referral.

Lyall Storandt, Real Estate Agent in OK (#177062) and TX (#617309)
405-361-1341
Originally posted by @Lyall Storandt :

@Jason Baehr I can only comment on our requirements, but Sherman Bridge Lending requires a vacant dwelling policy.

I could be wrong, but my understanding is that a builder's risk policy only covers you during the construction / rehab phase, but not during the marketing phase; whereas, the vacant dwelling policy will cover you as long as no one is occupying the property.

I have a few insurance contacts; feel free to message me if you need / want a referral.

 Lyall,

Could you please refer me to your insurance contacts? I need a vacant dwelling policy very soon. Thank you.

I currently use Foremost for my vacant policy during flip which you can get via a farmers agent.  I'd be interested in who others are using and rates. 

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