Landlord Policy Advise

24 Replies | Huntsville, Alabama

Hi all,

I was wondering if anyone could give me advise on landlord policy.  I'll be closing on my first rental property soon, and I've been shopping around for insurance quotes.  Below are 2 quotes I received: 

1) $1,723/yr for 300k liability, 225k dwelling with $2,500 deductible

2) $1,982/yr for 500k liability, 267k dwelling with $1,000 deductible

I'm thinking to do $2,500 deductible for lower monthly payment but unsure about how much liability coverage I would need and should get.  I was also wondering if those quotes seem fair for landlord policies in zip 35758.  Any advise would be greatly appreciated.  Thanks!

Jessie

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Hey Jessie,

Those rates seem a bit high to me. I am a broker for a small independent insurance agency, which means we can get policies from many different carriers. We have really good carriers for rental properties. I can PM you and get a quote for you if you'd like! 

I'd also recommend a 500k liability limit and a $2,500 deductible. Then if I were you, I would require your renters to get renter's insurance (which many times costs less than $20/mo). That covers you really well in case anything happens, and it won't cost you an arm and a leg!

Originally posted by @Bill Brandt :

Where are these properties located? Those quotes are seriously almost triple what I am paying on $300-$500k SFR properties in Las Vegas.

 This is in Huntsville, AL. I was able to get something else for almost 1/3 of the two quotes with same coverage. I wonder why the huge price difference though.

@Jessie Kristie  

Originally posted by @Jessie Kristie
This is in Huntsville, AL. I was able to get something else for almost 1/3 of the two quotes with same coverage. I wonder why the huge price difference though.

Where were you able to get such a better quote and are they a national company?  Please DM me.

I personally like a higher deductible. Most people won’t contact their insurance for small claims, to prevent their rates from rising. So if you’re not going to submit a claim for a $1500 event, why pay for the lower deductible.

I at least see insurance for those big events.

Also, I’d suggest looking at a $1M umbrella policy. It provides much more liability for your properties, including your home and auto. It also allows you to have a $250 or $300K liability on the primary policy, saving a few bucks there. Umbrella policies are quite inexpensive and allow me to sleep better at night.

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I agree with @Mike McCarthy . I specialize in Insurance for investors, and many times a higher deductible and a high limit for personal liability is the best move. Umbrella policies are less than 300/year for up to 2 Million in extra Liability coverage which protects you in pretty much any lawsuit. One thing I recommend having is extra water coverages on your policy. That can be devastating to an STR without coverage. Ask your Broker.

Hi Mike, 

I am considering umbrella policy. But if i don't have a car, do you think it is still useful for me?  thanks! 

Originally posted by @Mike McCarthy :

I personally like a higher deductible. Most people won’t contact their insurance for small claims, to prevent their rates from rising. So if you’re not going to submit a claim for a $1500 event, why pay for the lower deductible.

I at least see insurance for those big events.

Also, I’d suggest looking at a $1M umbrella policy. It provides much more liability for your properties, including your home and auto. It also allows you to have a $250 or $300K liability on the primary policy, saving a few bucks there. Umbrella policies are quite inexpensive and allow me to sleep better at night.

Hi Cameron,

If i don't have a car, do you still think umbrella insurance is helpful?

Thanks!

Originally posted by @Cameron Moore :

I agree with @Mike McCarthy . I specialize in Insurance for investors, and many times a higher deductible and a high limit for personal liability is the best move. Umbrella policies are less than 300/year for up to 2 Million in extra Liability coverage which protects you in pretty much any lawsuit. One thing I recommend having is extra water coverages on your policy. That can be devastating to an STR without coverage. Ask your Broker.

Got it, just wanna add more color, i am renting an apartment, do not own a house as primary residence. Could you please help me understand "only cover premises?"

Thanks!

Originally posted by @Cameron Moore :

@Helena Wu Of course! You can have umbrella policies that cover only the premises! They are cheaper as well. 

Understood, good to know! Can i send you a PM so we can get connected. I am sure I will need you help on getting an insurance for my investment property soon :)

Originally posted by @Cameron Moore :

@Helena Wu a Premises-only Umbrella policy protects you from lawsuits from anyone on your property that is injured and blames you. The umbrella would pay for the settlement, legal fees, and other expenses that come with lawsuits whether it is truly your fault or not. 

@Brian Sigrest   I was curious as to what your thoughts were regarding this:

I had run into a real estate attorney who had mentioned that in his mind a $1MM policy for an SFH property(regardless of size) was the bare minimum, and then had commented about having an umbrella policy of $10-20MM, which I thought was crazy high!

I invite anyone to join in and see what they thought particularly @Jeff Henderson , @Mike McCarthy , @Rod Hanks@Cameron Moore ?