Cost of Insurance, SFR

20 Replies

Hi Minnesota, I am wondering where you all have found the best value on insurance.   My rental property is in st cloud, value around 140k, 1910, roof newer than 8 years and I just got a quote for 900/year.  My gut tells me this is a little steep but I would like to hear what others have found.  



Is it in your name? or an llc. If its in your personal name you should be able to find a policy that will package with your home/auto. I have Met-life for personal home, auto, and 7 rentals. The rentals all are similar to yours avg 400-600 each. Thats for replacement cost coverage. I have other ones that are on separate policys that are closer to the 900 for the same property type.  Find your self a insurance broker and let him shop around. Ask them how many company's they work with. ect. 

Thanks @Joseph Hammel , any recommendations for an insurance broker?  I have my personal residence and vehicles on the same insurance, and my personal residence (worth much more) is less for insurance.  400-600 is the range i was shooting for. 

The property will be in my personal name for now.  

I thought one might have chimed in by now. My guy is Brian, Atlas Ins, Lake City MN.. BP wont let me post his # on here but I'm sure google can tell you. If you want PM me and I'll send it to you. As you get more units consider an umbrella as well.

Thank you @Joseph Hammel , i contacted Brian and hes on a search for the best rates, thanks for the recommendation. And thank you @Amber Gonion , I have contacted @Brandon Hershey and hes checking rate for me as well. 

From my experience, insurance rates on rental properties are higher than primary residence.   That being said, I would expect you would be between $600 and $900.

Amazing the difference in insurance rates in St Cloud, I have older duplexes in MPLS in the name of an LLC and I can't get insurance below $1800. I also work with several buyers a month for mortgages and the low end of what we see in the Twin Cities is $1200 on a primary residence, with an occasional outlier below $1100.

@Tim Swierczek wow insurance premiums are higher than I thought.  I may be very lucky after hearing this.  My insurance premium for my Single family home in Saint Louis park is about 860/year.  This includes a 1 million dollar umbrella and basement flood insurance.  St cloud is definitely not as high end of a market as down in the many parts of the city.  But there are pockets around town that pull some strong rental numbers.  I am under  contract on my first rental up there, so I can keep everyone informed on how that works out.  

The Northstar Rail just made it through the next round of getting approved to run all the way to st cloud starting in 2019.  Currently the Northstar Rail stops in Big Lake with only bus service serving St. Cloud.  It will be interesting if that has an effect on the market if it passes.  

I'm not sure what impact the Northstar line would have.  Right now, the train from Big Lake to downtown Minneapolis takes 55 minutes.  I'm sure from the East side of St. Cloud it would be close to 90 minutes one way.  I can't imagine too many people would put up with that long of a daily commute.  

It might be an option for people living in St. Cloud and working in Elk River or Ramsey.

@Tim Johnson   I currently commute over an hour by car for my job just south of St. Cloud.  My thought exactly for downtown unless its for a sporting event.  Lots of jobs being created in the Otsego/Elk river area as you know.  Seems like there's a couple new distribution facilities going up along 101 there every year.  

@Isaac Braun that seems somewhat reasonable for me.  I think the $860/year for your primary residence is cheap too.  

@Tim Johnson My rental rates are less than my rate as a primary residence.  Likely as they do not cover the stuff inside.  

@Tim Swierczek I'm curious if it has to do with the age of your properties.  My insurance company charges a lot more if the the home is older and does not have documented updates to the electrical and mechanical systems.  I believe @John Woodrich had an issue with that at one of his last primary residences.  

For comparison sake, I have three SFRs in the Hopkins/Minnetonka area with values ranging from $160k-$300k.  The lowest is $698 for a small home and the largest is $1,006.  I lived in the larger home at one point and it cost me more to insure when I was living there.

Thanks for your input @James W. .  I just received a quote from Brian at Atlas Insurance recommended by @Joseph Hammel .  Awesome guy, just got a quote for $682 for a standalone rental, now we are looking at what we might be able to do for a bundle with my primary, vehicles and umbrella.  Thanks everyone! We'll find the best value eventually, just shopping around.  

@Isaac Braun Make sure you compare the policies.

My policies are through State Farm and they are not looked at as the cheapest, but I have everything through them and have had good experience with them in the past.  My cheapest property is around the same as your quote and is a single family rental.

Originally posted by @Tim Johnson :

From my experience, insurance rates on rental properties are higher than primary residence.   That being said, I would expect you would be between $600 and $900.

My experience is the opposite.  I have lived in 4 houses that were also rentals at one point, they were all cheaper as rental policies.  I believe this is largely because they don't have to cover a gazillion dollars of personal property that they are making me insure.

Rates can also vary based on your credit and claims history.  They don't adjust the claim property but typically hit you on the future purchases.

@John Woodrich , yes true.  The personal property portion would not apply to a rental.  I was comparing the insurance cost for a rental unit compared to the "structure only" part of a primary residence.  

@Isaac Braun , one other note.  Don't be tempted to "forget" to metioned the fact that this is a rental.  In the event of a claim I'm sure that would invalidate your policy.

Best of luck!

That seems steep, I pay $550 for the same type of SFR with Allstate but you may have different limits than I

Do you all typically look for repair or replacement coverage in the event of a total loss? 

I go for full replacement cost. I was thinking if you call some of the fire restoration guys in the area they might tell you which ins co. are better at paying out well with claims.   

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here