What's the best insurance policy as I grow my rentals portfolio?

6 Replies

Hi everyone,

I started investing in rental properties through my LLC in 2015 and I currently have 6 rentals (10 units altogether as some are doubles).

I'm working with a local insurance agent and I insured each property separately with 1M liability. The price difference from the 500K liability was around $100 so I decided to go for the bigger coverage.

In average I pay around $850/year per property, but as I grow my portfolio these $$ starts to add up to a significant expense. I heard that there's something called an 'Umbrella coverage' that I can do through my LLC instead of separate policies?

I'll appreciate any advise that can help me get this cost down.

@Erez Shocher

I’m am no insurance professional but we have about the same amount of properties as you do and we chose to insure them at the 500k per property mark to save money.  We then added a 1 million liability umbrella coverage on top of those.  Total cost was $350 per year for all the properties and that covers the auto as well. (Auto is where the most litigation happens anyway) 

To go to 2 million it was $650

I saw that 5 mill was about $1200 a year. 

We are hopping that the 1.5 is enough. 

Hope that helps. 

Erez,

An umbrella policy may be a cheaper alternative for you with multiple properties.   A couple of things may cause you problems with some companies

1. some companies will limit the number of rental units they will cover over on a Personal Umbrella

2. if the properties are not all the same ownership you may have issues with some companies.

If your current agent has problems finding Umbrella coverage have them check with PersonalUmbrella.com.  They write just Umbrella coverage and can handle up to 40 units (4 family = 4 units).