Insurance for rentals and vacant properties deeded to LLC

9 Replies

Several real estate properties in KCMO owned under LLC, most are rented already, we typically buy a vacant house, spend 6 or so months to rehab it from top to bottom, then rent it out. Now we have a problem of getting insurance for these properties which are now deeded to the LLC. They all used to be under me personally, so I had them insured by Farmers and Foremost. Foremost was used for the properties while vacant and being rehabbed and then after the rehab and upon rental, the property would be transferred to Farmers. My Farmers agent tells me the only option with Farmers would be a commercial policy as the owner of the properties is the LLC. The quote I got was literally double what I was paying as the policies were under me personally. I understand that a policy without a personal guarantee would cost more than one with it, but I don't expect it to be 100% higher.

Can't I get insurance for these properties without going to a commercial policy? Thanks for all help!

Are you unable to have the LLC listed as an additional insured? I have had no problem getting my LLCs insured.

Farmers agent at first said that the "additional insured" would work but then said it wouldn't. 

If the property is in the name of the LLC, but you insure it in your personal name and additional insured the LLC, you are at risk of voiding the policy. Due to no insurable interest of the named insured.

How many KCMO properties at any given time? I can list the insurers that would be interested in providing competitive coverage.

Right now, 6 houses, but I'm adding 2-3 more per year, so a policy that can grow with me would be awesome.

Originally posted by @Derek Lacy :

If the property is in the name of the LLC, but you insure it in your personal name and additional insured the LLC, you are at risk of voiding the policy. Due to no insurable interest of the named insured.

How many KCMO properties at any given time? I can list the insurers that would be interested in providing competitive coverage.

 Please let me know who can help.

Most companies that insure vacant properties also offer landlord policies and they will insure under what ever name you own it in.

Check out RealProtect.com or APIAProtects.com

A LLC is a separate entity, so just because you own the LLC, does not mean you are the LLC. I would make sure to disclose the situation to the agent precisely, so that I was sure my properties were insured. I found that once I used an LLC for ownership, my insurance company required a business policy on top of the rental property insurance, so it went from around $500 to $900 per property. I also found that certain companies would not insure vacant property and those that do, charge more because of the increased risk of damage to a vacant home.

Originally posted by @Kim Tucker :

Most companies that insure vacant properties also offer landlord policies and they will insure under what ever name you own it in.

Check out RealProtect.com or APIAProtects.com

Will these guys write policies for me that are for the LLC and such that if a claim is ever made, I won't be impacted personally (won't appear on my loss history)?

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