How to best estimate landlord insurance cost in your calculations

3 Replies

I am finding it perplexing as to how to best estimate landlord insurance policy costs on various properties. As I understand it, the policy costs vary due to age, construction, etc.  In the webinars, I have seen Brandon pop $75/month into that box, but now that I am connecting with insurers, I am finding out that there is no average and that number seems low.  How do you all deal with inputting insurance numbers? Do you pass each property by your agent?  Is there a way to use an average number just for the initial pass.....and how would I calculate that?  Thanks everyone!

I don't know what kind of properties you invest in - and where you invest.  There are a lot of factors.  For example, my parents house is in fire territory in California so it is expensive.   

All of my properties are in one city.  I use a policy tailored for landlords, so I can add multiple properties to one policy.  For my apartment buildings, there seems to be variation in pricing and these properties are on separate policies.

My single family houses average $650 per year for lower end rental houses.  More than double for nicer properties.  And around $350 - $400 per unit for basic apartment buildings.  Read the insurance policy carefully, because you may not be insured when you buy a vacant property that needs renovation.  I use a six month policy - I believe it is called builder's risk.

I suppose you can get some quick quotes online to help your analysis.  

Where I am I have seen the average to be $900-$1300.  That's just from experience.  I'm east coast in the mid-Atlantic region so CA is probably very different.  For me it's easy, I toss in $1100 as the number for my general estimate.  I'll only bother my agent when it looks like a buy to me.  At that point I'll send my agent an email with the address, purchase price, etc and ask for a quote to plug that final number in.

@Brian Ploszay and @PJ M. , I appreciate both of your inputs!  I am shopping in NW Arkansas. I have now received quotes on the same property from various agents and firms and will evaluate the policy components and prices. Hopefully I can get a general ballpark, like PJ mentions, and go from there.  I am ensuring the policies will contain dwelling, personal property (washer/dryer, fridge), and liability.  Any other policy coverage to look for?  

The Shelter agent told me about a policy they have, which covers buildings 15 years or newer, affordable, and also covers tornado damage and other "acts of god". That seems pretty interesting. It is also competitively priced, at least from initial glance. Need to get them all up and compare carefully.

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