Home Insurance on my second House Hack

[Megan Herrington]

Hi everyone! I bought a house hack last year and my husband and I are buying another househack this year and wondering what the best insurance setup would be. We have Safeco primary residence insurance right now but when we move out of our first househack maybe we need to change to a different insurance setup up to protect us since we’re not living there anymore. Any thoughts?

[Jay Thomas]

Safeco for your primary residence sounds like a solid foundation. But as you transition to multi-unit landlords, your insurance needs a bit of a makeover.Ditch the primary residence policy: Once you move out of your first house hack, it'll no longer qualify as your primary residence under most policies.Upgrade to a landlord insurance policy, and you have a few options. A Dwelling Fire Policy covers the building but not your tenants' stuff or liability. Rental Property Insurance is more comprehensive, including the building, tenant liability, and rental income loss. For extra protection, consider Umbrella Insurance against big events or lawsuits. Keep an eye on the number of units your policy covers, screen tenants thoroughly to minimize risks, and stay on top of regular maintenance to avoid claims from neglected repairs.

[John Mocker]

Megan,

A couple of things on the insurance.  As Jay pointed out, once you move out of your current Residence it will not qualify for a "Homeowners" policy.  What you have now from Safeco is most likely a Homeowners policy.  If Safeco's guidelines are similar to CT the policy will need to be changed.  You can rewrite it to a Dwelling Fire policy (can cover Building, your contents, Loss of rents, Liability, ....) or you can move the coverage to a commercial policy.  I'm not sure if that is what Jay is refering to with the "Rental Property Insurance".   

If the current property is in your name or an LLC with only yourself and spouse as LLC members, the Dwelling Fire should be less expensive. You should also be able to get an Umbrella policy to cover over the Liability coverage of the New home, the Dwelling Fire, your autos, etc.

You may want to shop all the coverage to make sure Safeco offers the best pricing and most complete coverage for all the policies together.

[Wale Lawal]

@Megan Herrington

Thank you for sharing your house hacking skills! It's crucial to review your insurance coverage when moving from a residence to a rental. To make sure you have the appropriate insurance configuration, take into account the following factors and do the following actions:

1. Inform Safeco: Contact your current insurance provider (Safeco) and let them know about the change in occupancy. They need to be aware of the property's status as a rental to adjust your coverage accordingly.
2. Consider Landlord Insurance
3. Renters Insurance for Your New Residence:
4. Consider Umbrella Insurance
5. Policy Review and Comparisons:
6. Bundle Policies:
7. Verify Coverage Details:
8. Document Property Condition:

You may make sure that your insurance coverage corresponds with your current living situation and way of using the property by following these procedures. Remember that the kind of property, location, and other factors might affect your insurance needs, so it's always a good idea to get guidance from an experienced insurance agent.

All the best!

[Megan Herrington]

Thanks all! You’ve confirmed what I thought I needed to do. Anyone have any recommendations for an insurance agent in the Boise, ID area?