Best way to insure many rental properties

9 Replies

Hey all -

What is the best way to insure many SFR's and take advantage of economies of scale?

I have multiple different providers and own many different properties in a few states. One of my insurers will only do 4 properties, and others don't seem to give you a better deal for having many. Is there a best practice on how to insure many properties and leverage that for the best possible rates?

Thanks!
Lance

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@Jay Hinrichs thanks, that’s good advice. I’ve talked to a couple brokers in the past, but they were never better than working direct with the companies: Nationwide, State Farm, etc (most I have are with those two)

Any brokers that you could recommend? Maybe on this forum?

Thanks!

Originally posted by @Lance Robinson:

@Jay Hinrichs thanks, that’s good advice. I’ve talked to a couple brokers in the past, but they were never better than working direct with the companies: Nationwide, State Farm, etc (most I have are with those two)

Any brokers that you could recommend? Maybe on this forum?

Thanks!

Lance, from the sounds of it, you were checking with a personal lines broker.  Now that you have several properties, you will want to work with a commercial broker to take a look at a master policy that covers all locations, no matter the state or if you have 3 or 1,000.

I have seven properties and have done some research.  I have 7 individual polices and they are cheaper as a whole versus one commercial policy.  Any bulk discounts you could hope to achieve are outweighed simply by having the word "Commerical" in the policy.  

@Ken Musial this has been my experience too, I revisit this every couple of years and it’s sooo time consuming its barely worth the effort. But I will go through this again and report back my findings.

@Lance Robinson

I go back-and-forth with this issue all the time.. We got 46 single family homes and we find the cheapest solution is to have 46 individual policies versus one master policy. And with the master policy idea you're gonna have one deductible that applies to all the properties so if you got 1 home that a tree falls on, your deductible is going to based off the entire policy valuation and in most cases is going o be more than the actual claim itself.

What's the point of paying a $35,000 deductible when you only have $21,000 worth of damage... This is usually what happens with these big commercial master policies.

Another option which might not be realistic for a lot of people or even too complex to understand is called a "captive" , Google it.