I'm under contract for my first property in the Seattle area - a duplex in Puyallup.
Assuming I get the property, does anyone have a referral for an insurance company? And what coverage is needed - just the building, any contents inside, an umbrella policy for liability protection, etc.? Any help is greatly appreciated!!
Can't help with a referral but I suggest that you interview several and find out their experience in this space. I can give you some general info on insuring the property:
Here are some things to look for from an Insurance prospective:
- Any in-ground tanks (active or inactive)
- Any Knob & Tube or Aluminum Wiring
- If built before 1978, does the building have Lead Safe certifications
- Any wood stoves or secondary heating units. If so, were permits pulled & were they installed by a professional
- Are any of the homes rented to students
- Is there a flat roof
- are there asbestos shingles
You may want to ask them to get a claim report from the company(ies) that insured the property for the past 5 years. If there are claims, you want to find out if the problem was addressed. Also, if there were 2 or more claims in the past 5 years you may have trouble getting coverage from a standard company.
The Year that the following were updated (either partially or fully) would be good to know:
- Heating systems
Some companies will not write properties with systems that have not been updated.
As long as you are living there, the proper policy for a 1-4 family is a "Homeowners" policyc. If the property is solely tenant occupied you will be looking for a Dwelling/Fire Policy (may be called a Landorrd policy or similar name) or a commercial policy such as a Businessowners or Package polciy.
Most homeowers or dwelliing/fire policies include:
1. Dwelling (Building coverage)
The limit should be based on the Replacement Cost of the building (cost to rebuild with
the same kind and quality excluding the foundation)
2. Contents (Personal Property): most homeowners policies give a set % of the Building
limit for Contents. Dwelling/Fire policies requrie that you request a limit for conents.
3. Detached Structures: for other buildings on the property (ie. sheds & detached garages)
Again, there is normally an included limit of 10% of the building limit. That can be increased
4. Loss of Use / Loss of Rents: Normally, there is a 20% included limit. Loss of use is for
your additional expenses if you can not live there due to a covered claim (ie. Fire). The
Loss of Rents is for the loss of Rental income if the tenants can not occupy the house
after a covered loss.
5. Personal Liability: For claims due to Bodily Injury or Property Damage that you become
Liable for and which is covered under the policy. Companies normally offer limits up to
$500,000 but some offer $1,000,000. Buy the max.
6. Medical Payments: Provides coverage for an injury suffered on the premises. Does not
require proof that you were at fault. Used to keep small loses into becoming lawsuits.
Normally offered up to $5,000 but check to see if higher limits are available.
7. Deductible: This is not a coverage but rather your portion of a claim. Most better policies
will not have a deductible for either the Liability or Medical payments coverage. It will
apply to the other 4 coverages. You can select the amount of the deductible, usually
ranges from $500 to $5,000. The higher the deductible the lower your overall premium
but get quotes on all the deductibles you are interested in. Sometimes the incremental
savings from $1,000 to $2,500 or from $2,500 to $5,000 are too small to make the higher
deductible worthwhile. ***depending on how far the house is from the coast, you may
also be required to have a separate Wind or Hurricane deductible. Most times, the
deductible will be 2% to 5% of the building value. That is a significant amount
(on a $500,000 building that comes to $10,000 for 2% or $25,000 for 5%). A policy
with a higher premium may be a better deal if it does not have a wind deductible.
There are many endorsements that are available on the homeowners policy. Without
knowing the details I can not suggest which would be right to add on.
Several you should
pay attention to are:
- Ordinance & Law: Provides additional building coverage to deal with rebuilding cost
Increases due to changes in Zoning or Building laws
- Personal Injury Liability: Libel, defimation of character, wrongful imprisionment, etc.
(normally recommended, especially if you are a landlord)
- Water Backup: For water damage due to the backup of Sewers or Drains.
- Personal Articles: Coverage for belongings that have a special or collectors value
such as Jewelery, Furs, Fine Arts, Collectibles, etc...
Your age should not be a factor on the pricing but, depending on the company these other factors may get you credits:
- Insurance Score (company pulls certain info out of your credit report)
It is not your credit score but generally better credit will result in a better score
- Time at your job
- Education level
- time at current residence
@Doug Karkow I have a couple brokers I can email out.
@John Mocker Wow John, very thorough! Thanks for the tips! The duplex was built in 2007, so it won't have some of the issues you mentioned, but the list of coverage items to look for is extremely helpful. Thanks again!
@Lane Kawaoka At this point I haven't received any referrals, so I'll take yours if you don't mind! Better to start there than from nothing! Perhaps you can send me a message with their contact info. Thanks!
@Doug Karkow Ken Martin Kirkland WA
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