Homeowners Inurance for a rehab property

3 Replies

Can anyone provide advice for how to secure homeowners on a rehab property? This will be my first property that is distressed like this. It needs a roof, electrical, and a few other small items and I don't think my traditional agent will bind coverage from what everyone is telling me. There has to be a solution for this until I can pass a 4 point inspection and secure a traditional policy. Is there a specific type of policy or is there a process for this type of thing?

Ian,

Check with multiple independent agents.  There are a couple of ways to handle it.  The way I see most often is a Renovation Builders Risk Policy.  The Builders Risk policy was designed for new home construction to address the property coverage as a house is being constructed.  The renovation policies insure the existing structure and the renovation (that is the builders risk part).  Often the Existing structure is covered on the Actual Cash Value (replacement cost - depreciation) and the renovation is covered based on the value of the work being done.  

You will also need Liability Insurance for the property.  If you are self GC for the project you will also need Liability for that exposure.  You may also need Workers Compensation coverage if you are hiring anyone, even subs.  It will depend on your state laws and other factors.  Good luck on the project