San Antonio, TX - Appropriate type of insurance for rental house
OK, not really sure of the question to ask here.
We are on day 3 of our option period and i am trying to get insurance quotes done for this rental house i am planning to fix up and rent (SFR). Now i own a primary residence and have a run-o'-the-mill homeowners policy, but i wasn't 100% sure about what 'typical' policies and coverage were obtained for rental homes.
My wife was trying to get a quote online yesterday and the house valuation to rebuild came in at like $204k, but the ARV for the area is no more than $140k. This doesn't add up for me since i can't imagine spending $204k to rebuild a house where the market values are so much lower. Are we looking at too much coverage possibly?
i see a lot of monthly insurance rates (from lender, other investors) at around $65 a month, but the estimate we were given from this online system was like double that.
It's our first one, so I'm in the middle of the option period frenzy to get everything done in time and i wanted to be sure I'm thinking about about this right.
I'm curious if any local investors (if location has anything to do with it...i'm guessing it does) would mind sharing what types of policies they get for their rental houses.
Thanks for the input.
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Real Estate Agent Texas (#719290)
- (210) 279-5133
- http://www.MilesStanley.ExpRealty.com
- [email protected]
Hey Miles,
I would get only purchase a TX DP3 policy. This covers for loss of rent and water damage. Message me if you have more questions. Good luck!
You will not be buying homeowners. I think it is called dwelling. The replacement cost is what the insurer thinks it would cost to rebuild if the property burned down. I suppose you could insure for what you owe so as to be made whole if a fire happened and plan on just selling the lot.
Can you recommend any insurance providers in san antonio (or elsewhere) that offer good coverage at competitive rates? Or am i best served going to a big box provider (USAA, Allstate, Nationwide, etc). i dont know if investors use the same companies as the average homeowner or if there are other options?
Thanks
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Real Estate Agent Texas (#719290)
- (210) 279-5133
- http://www.MilesStanley.ExpRealty.com
- [email protected]
Miles Stanley I've found that Safeco offers the best dwelling/fire policies for rentals in our area. I use them for all my SFRs. Message me if your interested in the broker I use. Good luck moving forward!
Hey @Miles Stanley if you were at my meeting several months ago you would have heard Monica James with Farmers talk about all of the different types of insurance that are available and where you need to use them. A rental house is going to need what some people call a rental policy or landlord policy. Of course you can add and subtract little bits here and there. You can insure the cost to rebuild or just the cost of purchase.
I value service over the lowest price. If it is the lowest price, even better.
The other day when I closed on a property I completely forgot about insurance. It was financed and my title company called and asked about insurance about an hour before closing. Closing was at 5pm. One phone call with a few details of the property and coverage was in place. Could I have gotten the policy $50 or $100 a year cheaper? maybe. Taking care of things quickly and so that I dont have to worry about them is worth the money.
@Miles Stanley I recommend Access Insurance Services in SA. We've worked with Timothy Miller there for landlord insurance.
@Miles Stanley send me a message and I can give you the contact info for the insurance brokerage we use. They are based out of Houston but cover all of Texas. I received 2 binders from them in the last week for my investors getting ready to purchase a project with hard money. They can run you through the different options of coverage for both the rehab process and for when it is rented out. We sell on average about 25 discounted properties per month in the San Antonio area and they are our go to guys.
Cory Jacobi I have a broker i use now. Previously I would call around but my guy saved me money on personal and investment homes. Some I paid about $100
More because I was provided water damage coverage but now I am. Let me know if you are interested in his contact info.
@Cory Jacobi and @Rudy Hernandez I'm currently searching for an insurance broker, would you mind messaging me the company in Houston you referenced? Thanks!
@Ben Volkman did you ever receive the referrals you were looking for?
@Andrew M. I would love to hear your agent referral. Would you mind posting or messaging me?
@Cory Jacobi would you mind shooting me over the brokerage info you mentioned?
@JR M. I did get a referral for 1 in Houston but haven't called them. I'm currently in a holding pattern on obtaining a property but once I have something serious I'll give them a call. Do you have one in the area that you recommend??
@Ben Volkman I am sorry to hear that. I was actually hoping to borrow your notes as I look for the same. Would love to get the name and contact if you don't mind. Otherwise, best wishes!