Insurance on my first Rental

5 Replies

Hi BP Family,

I am trying to see what kind of insurance I can have on my first rental home(my primary). I called my insurance company hoping to just insure the outside of the house(to lower my monthly payment) but they quoted me double what I am paying now just because they have been receiving lots of claims from rented homes.

Any idea what I need to proceed in this step?  What do investors elect when they want to rent their home or properties?

Thanks,

Asem

I would first check with other local insurance companies.  You can find references on this forum or from other local investors. 

Are you requesting full coverage of actual-cash-value (ACV)?  The ACV quotes are much lower, but so is the coverage level.  I personally use ACV for the much lower rates.

Have you contacted Foremost Insurance? 

Hi Johnathan,

I currently have full coverage and it is a relatively new home. I am not sure if the bank will allow me to do ACV for a much lower rate.

let me check Foremost insurance and see.

Thanks for your advise.

Asem

@Asem AbuAwad There are significant differences between ACV and replacement cost. There is also something called co-insurance which is important to consider. I just sent you a PM. Give me a call if you like. I'd be more than happy to go over things with you. My info is below. 

@Asem AbuAwad Both @Anthony Lee and @Jonathan Alesso have something with the ACV. I also like the idea of looking at Foremost. They will insure properties that most companies shy away from. Working with a broker who represents multiple carriers is probably the way to go in this case. Also, think about choosing a higher dedct. to off-set a premium increase. And make sure you require that your tenants carry renters insurance and present you with a copy of the policy declarations to verify coverage is in-force.   

Hi Gerald

Great advise!! I will go with a broker to check various carriers and am planning to make the tenant have renters insurance prior to giving him the property.

Thanks,

Asem

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here