Real Estate Investor · paw paw, MI · Member since 2010 · 17 posts · 5 votes
Why is it so hard to find an insurance agency that can provide insurance for 9 rentals in LLCs, umbrella policy for all of them and do this with in a reasonable cost? Im am better off keeping my properties out of an LLC and not putting them together with one agency. Why does it cost more to have LESS coverage if you go commercial? I get more coverage for less $$ if there not commercial, BUT I want the umbrella policy. Anyone with experience navigating though insurance and hours sitting on the phone trying to beg someone to quote my biz. Thanks!
Rental Property Investor · Manteno, IL · Member since 2009 · 2k+ posts · 2k+ votes
13y
Can't help you with the umbrella policy issue. But I know that my insurance company doesn't differentiate on the ownership type. The rate is the rate. They specialize in investment property.
Another added benefit in using them is that you can get replacement cost insurance but you can get it at a number that makes sense to you. In other words, when I had State Farm, they would set the max replacement cost for what it would cost to rebuild. So even though the house appraised out at 140k, they were still requiring me to insure the house for 210k. And I inly owed 80 or 90k on the house.
The new one lets me do replacement cost but lets me set the amount I want to max out at. So in this case, I switched my coverage to 100k - enough to pay off the loan plus a little something extra to take care of any lot demo.
Then I figured I would end up with a lot free and clear. Saved myself about 30% on my insurance costs. Over 17 properties, thats a nice chunk of money. Roughly $400 a month - or 5k a year in my pocket which basically pays for a nice vacation for my family every year.
You might be able to check with them about an umbrella policy as well.
Their name is Affinity Group. Also go by National Real Estate Insurance Group.
btw: I am not an employee of theirs, nor do I get any kind of referral anything either. Just a satisfied customer with their very unique service.
Rental Property Investor · Manteno, IL · Member since 2009 · 2k+ posts · 2k+ votes
13y
Can't help you with the umbrella policy issue. But I know that my insurance company doesn't differentiate on the ownership type. The rate is the rate. They specialize in investment property.
Another added benefit in using them is that you can get replacement cost insurance but you can get it at a number that makes sense to you. In other words, when I had State Farm, they would set the max replacement cost for what it would cost to rebuild. So even though the house appraised out at 140k, they were still requiring me to insure the house for 210k. And I inly owed 80 or 90k on the house.
The new one lets me do replacement cost but lets me set the amount I want to max out at. So in this case, I switched my coverage to 100k - enough to pay off the loan plus a little something extra to take care of any lot demo.
Then I figured I would end up with a lot free and clear. Saved myself about 30% on my insurance costs. Over 17 properties, thats a nice chunk of money. Roughly $400 a month - or 5k a year in my pocket which basically pays for a nice vacation for my family every year.
You might be able to check with them about an umbrella policy as well.
Their name is Affinity Group. Also go by National Real Estate Insurance Group.
btw: I am not an employee of theirs, nor do I get any kind of referral anything either. Just a satisfied customer with their very unique service.
Attorney · Raleigh, NC · Member since 2008 · 4k+ posts · 1k+ votes
13y
Jennifer,
AAA is based in Michigan. Try them first then see if Foremost will write your houses. The way to do this is not on the phone but in the office of a savvy agent.
Real Estate Professional · Baltimore, MD · Member since 2012 · 30 posts · 4 votes
13y
here's a contrarian view - run the numbers, sometimes it might make sense to not carry insurance.
If you're diversified enough that one property burning down won't really bother you that much and no plan or need to rebuild, then why bother with insurance?
If you're confident enough with asset segregation in the LLC and not concerned about personal liability, then, just go without.
Make tenants carry renter's insurance and reimburse them.
Anyway, not that I'm recommending it, but for scenarios where a property is worth 50k in a isolated LLC, I don't see the upside to paying 1k in insurance.
Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
13y
Originally posted by Leo Cao:
here's a contrarian view - run the numbers, sometimes it might make sense to not carry insurance.
If you're diversified enough that one property burning down won't really bother you that much and no plan or need to rebuild, then why bother with insurance?
If you're confident enough with asset segregation in the LLC and not concerned about personal liability, then, just go without.
Make tenants carry renter's insurance and reimburse them.
Anyway, not that I'm recommending it, but for scenarios where a property is worth 50k in a isolated LLC, I don't see the upside to paying 1k in insurance.
Unless you have 300 houses in a war zone, I would not recommend this.
I would call an insurance broker and have them shop around for a good deal for you. Something with a high deductible will give you the best rate.
Investor · El Dorado Hills, CA · Member since 2012 · 1k+ posts · 1k+ votes
13y
Are there any insurance agents active in your local REI Groups? There are usually a few hanging around that are investors as well. Unfortunately cold calling offices for something fairly specific might confuse the lower level employees that are often answering the phone. You can find some of the better independent insurance agencies in your area using the agent locator at www.trustedchoice.com
Attorney · Raleigh, NC · Member since 2008 · 4k+ posts · 1k+ votes
13y
Originally posted by Leo Cao:
here's a contrarian view - run the numbers, sometimes it might make sense to not carry insurance.
If you're diversified enough that one property burning down won't really bother you that much and no plan or need to rebuild, then why bother with insurance?
If you're confident enough with asset segregation in the LLC and not concerned about personal liability, then, just go without.
Make tenants carry renter's insurance and reimburse them.
Anyway, not that I'm recommending it, but for scenarios where a property is worth 50k in a isolated LLC, I don't see the upside to paying 1k in insurance.
Here's the view of a claims professional who doesn't sell, but deals with the aftermath of bad things happening. At least carry liability, unless you're cool with losing everything.