How do you deal with multi-state insurance

Question

I am trying to evaluate an insurance for an out of state investment property.

My StateFarm agent connected me with another agent in OH who quoted me a $700.00+ per year for a $60,000.00 house. I have multiple investment properties in CA that are appraised at over $200,000.00 for which I am paying less than $300.00 per year. Even my primary residence that is valued at ~$800,000.00 is under $2,000.00/year. I cannot wrap my head around why should I pay for the same amount of insured property 7 times more (the crime rate in both areas are the same according to Trulia/Zillow). Why would people in OH are willing to put up with such high insurance rates?

The agent told me that they cannot give me a multi-policy discount because my 11+ policies (properties, cars, umbrella, etc.) are in CA.

Now I am facing the dilemma:

- should I look for another insurance provider just for that property in OH, or

- should I look for another insurance provider to replace ALL of policies since the effort would be practically the same.

What would you do in my case?

Joel Owens · Answer

Bobby have you bought this property yet or are you considering to buy it??

If you have already purchased it the insurance research should have been completed before closing and that should have been factored in your offer price if that was all that was available.

It sounds like as mentioned you are used to low premiums because they are a package. Once you start grouping properties together it is not that much more to insure another one versus a stand alone policy for a small property.

You might just have to pound the phones for some carriers to find one hungry enough for the business in that area.

Bobby Narinov · Answer

@Jason Bott My investment properties/rentals go for over $200,000.00 and their insurance is between $170.00 and $280.00 per year. And they are in a worse area than this property: i.e. they are in low income, modest crime area.

If I do the same calculation using my most expensive insurance I get 3x the price for 36% of the premium. It comes to over NINE TIMES MORE for the same amount of insured value.

Jason Bott · Answer

@Bobby Narinov the price difference between your CA policies and the OH policy has more to do with the CA policy being tied to you personal policy package than anything else.

$700 is high for $60k, that works out to be a $1.16 per $100, which is double of what is out there.  With only 1 location with low value, the name of the game for you is finding a policy that has a low minimum Premium.  Most companies have a $500 minimum.