Simple book keeping question: umbrella insurance

[Andrew S.]

I have a quick question as to how to allocate my umbrella insurance premium to my REI expenses. As the insurance also covers my non-rental assets, do I need to split the cost of the premium for book keeping purposes? If so, how?

@Steven Hamilton II ?

[Steven Hamilton II]

Originally posted by @Andrew S.:

Thanks @Steven Hamilton II !

The answer is "yes, I would have it without RE as well". So do you mean allocate by value of rental RE assets vs. other assets? Or allocate by amount of coverage I WOULD have in the absence of RE investments vs WITH RE investments. Or the amount of perceived risk? Or other?

I agree that most of my RISK will likely come from the RE investments, but most of the assets I'm trying to protect are actually non-RE, as I don't own very many rental properties yet :-(

The easiest way is if you increased your coverage upon RE acquisition to use the amount of the increase. Or to utilize the list of risks the insurance company used to calculate your coverage.

I would use a ratio of the personal/RE risks.