Rental Property Investor · Houston, TX · Member since 2020 · 18 posts · 11 votes
I just acquired my first STR and am working on getting the proper insurance in place. I used a secondary home loan so the property is in my name and not an LLC. I am wondering what kind of coverage I need and how to structure the insurance policy so that I'm appropriately covered. I own my primary residence as well. Any help would be appreciated! Thanks!
funny thing is you said "proper" and the biggest STR insurance carrier is called "Proper" look in to them although they will be expensive. Otherwise ask existing broker if they can do commercial without a lease. Might have to make half a dozen phone calls to find what you're looking for.
funny thing is you said "proper" and the biggest STR insurance carrier is called "Proper" look in to them although they will be expensive. Otherwise ask existing broker if they can do commercial without a lease. Might have to make half a dozen phone calls to find what you're looking for.
You need to make sure you have Commercial Insurance for a STR. There are companies that specialize in this, but I found my State Farm agent (that provides coverage on primary residence) had a plan for STRs, and I use them for both of our places.
An LLC is not necessary, (I have done it both ways) but ask your attorney. Of course most attorneys will say you need one.....so do some research as well.
@Luke Carl Thank you. I have my current home and auto under two different providers. The current agent I have been talking with had mentioned a “rental dwelling policy” I cannot find much on this. Do I additionally need an umbrella policy to separate this from other assets and primary residence?
@Austin Spitzenberger The “rental dwelling policy” your agent mentioned is probably only for long term rentals. You need one specifically for short term rentals.
@Austin Spitzenberger The “rental dwelling policy” your agent mentioned is probably only for long term rentals. You need one specifically for short term rentals.
I agree, the agent may not understand the use as short term rental or may not be aware that most "rental dwelling" policies do not cover short term rental. Be very specific and in writing when you disclose the use. You will also want additional liability coverage. STR have higher incidents of liability insurance claims compared to long term rentals, which is why the premiums are higher and some companies avoid this type of coverage.
I have a STR in ST Louis MO. Property built 1920, remodeled 2006....when I got a quote from "Proper" Insurance its $6K per year....for a 1K deductible....agent's reasoning is for old properties even though its remodeled 15yrs back with new roof etc, its high premium. BP STR experts can anyone provide info for alternate companies or ideas how to get STR insurance and not cost arm and a leg :-)
I have a STR in ST Louis MO. Property built 1920, remodeled 2006....when I got a quote from "Proper" Insurance its $6K per year....for a 1K deductible....agent's reasoning is for old properties even though its remodeled 15yrs back with new roof etc, its high premium. BP STR experts can anyone provide info for alternate companies or ideas how to get STR insurance and not cost arm and a leg :-)
Try State Farm.....we have our other policies with them and when I checked, they have a specific coverage available for STRs. One of our places is from the 40's and they had no problem issuing coverage for it. $100 a month.
I used a 10 percent down conventional second home loan. This property is not under an LLC. Will I still be covered under a commercial policy even though the loan is in my name?
I used a 10 percent down conventional second home loan. This property is not under an LLC. Will I still be covered under a commercial policy even though the loan is in my name?
Hey Austin! Did you ever get an answer to this question? I'm in the same boat :)
@Persa Z. After speaking with Proper Insurance, I was informed that the property does not have to be under an LLC and that the commercial insurance policy still applies. Hope this helps.