Insurance?

13 Replies

Hi All

You know, all these guru's talk about getting the title, flipping, how to get or sell the property. I've been to expensive seminars, affordable seminars, read on line articles, books.

But no one seems to talk about practical things like how to get your rehab house insured if no one is living in it. Yup, any one out there doing multiple short term rehabs? Got hazard or fire insurance? I'd really like to know how not to pay through the nose to insure these properties for the short time (less than 6 months) I'll be owning them. I do have insurance on the properties I have and it's twice the normal HO insurance rate.

Counting the costs,

Bird

If the property is ready to be rented and not in a state of disrepair, we declare it is being occupied for personal use. Storage, office whatever. Utilities need to be on and you need to occupy in some way. Works for us.

Unfortunately, hazard insurance on rehab properties is very expensive. To look at it from the insurance company's perspective, they are insuring a property that is obviously vacant and a sitting target for trouble. On top of that, there is going to be heavy work performed by several different people who have access to the property which also increases risk of trouble.

Obviously insurance is a necessary evil, but I am sure glad it is available on these properties (evan at a high cost) because of all of my investor's cash that is sunk into them.

great site everyone. prohabber could you give some examples of insurance companys that provide insurance to rehabbers.

the one I have done I lived in while rehabbing and the next I will not be living in and I don't think every insurance company will provide reahab insurance on a property.

There are some specialized insurance agents that insure rehab type properties. I don't know of any general one to use that is good all over the country. I found my guy through the local REIA organization and he is fantastic.

I use Chris Pavlisko, who is the President of Pavlisko & Associates, Inc. You can find him at www.pavliskoagency.com. He is licensed in Ohio, Kentucky, Indiana, Michigan, Florida, and Texas. I don't get any kickback for recommending him, but it would be nice if you said that Bryan Casteel told you to call him. He is outstanding.

Does anyone else have a recommendation for an insurance agent for junker type properties?

Does anyone else have a recommendation for an insurance agent for junker type properties?

remember the old saying prohabber, "one mans junk is another mans treasure". :mrgreen: :D

Every situation has a need for different types of insurance. From a high risk, high hazard policy to an ultra preferred occupied home

I'm going to throw my hat into the ring. Check out Affinity Group Managment, [LINK REMOVED]. I work there but before working here I was a customer and used the insurance program for about 50 rehabs.

I have one rental insured by Nationwide. They declined to insure my other property because it was going to be vacant and rehabbed before I got it rented, I have it insured with Farmers.

Originally posted by belinda:
If the property is ready to be rented and not in a state of disrepair, we declare it is being occupied for personal use. Storage, office whatever. Utilities need to be on and you need to occupy in some way. Works for us.
This is not what I would consier to be good or valid advice. Doing so is just the reason an insurance company would need to get out of paying a claim. Stating it is for personal or office use when it is not is insurance fraud.

As Bryan stated, insurance for NOO properties is more expensive and is part of doing business. Skimping on this could be a recipe for disaster. Error on the side of caution and get the appropriate insurance. Over insured may cost you a bit more, but under-insured could cost you everything!

Stve babiak, our resident Link Master has provided several links to reference on this very topic.

I use my Farmers agent who writes a policy thru Kraftlake Insurance. They provide NOO insurance, provide me a $1M liability coverage, include replacement cost and my rehab cost in the policy. It may be more, but is worth it to me. My property values are usually above $300k and often $400k and the 3 month cost is $450 or so. For less expensive properties, I am sure the cost goes down.

If anyone is in CA and would like to speak to my agent, feel free to contact him: Johnny Castaneda -
Note: I receive no kickbacks and have no affiliation with him other than my own insurance service provider.

Originally posted by Jason T.:
I'm going to throw my hat into the ring. Check out Affinity Group Managment, [LINK REMOVED]. I work there but before working here I was a customer and used the insurance program for about 50 rehabs.

Why would you go from doing 50 rehabs back to an office job? I'm just curious

Originally posted by Corey Demuth:
Originally posted by Jason T.:
I'm going to throw my hat into the ring. Check out Affinity Group Managment, [LINK REMOVED]. I work there but before working here I was a customer and used the insurance program for about 50 rehabs.

Why would you go from doing 50 rehabs back to an office job? I'm just curious

That's a long story, not one for a forum. In a nutshell, I was ready for something else. Plus, I was made an offer I couldn't refuse :D

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