Recommendation for insurance property in LLC?

Question

I have a lower priced 4 unit ($265k value) that is held in an LLC and am currently paying $2200 a year on it. Does this seem reasonable ideally I could insure it for value vs rebuild cost? It's in midwest where insurance rates normally lower. Any recommendations for good investor friendly agents I can shop the rate with? Appreciate it!

Owen Rosen · Answer

sent a DM

Stuart Udis · Answer

@Henry Lazerow you should include the city where this 4-unit is located. Midwest is too large of a territory for an accurate comparison.   Insurance premium determinations  are more localized where the carriers price perceived risks into their desire to have market exposure (if at all) and how to price that exposure.

From there  you will often see certain carriers be more aggressive in specific markets. An insurance broker explained this to me in the past as the law of  large numbers which suggests if a a carrier has significant enough exposure in a market the probability of claims arising will be more consistent with probabilities calculated in their underwriting than a when a smaller sample size were to exist. The carrier that has less exposure but chooses to be in that market may price their coverage higher because of greater uncertainty/ less predictability.

This is why disclosing the city is important. There’s likely a carrier that’s most aggressive in the city where your 4 unit is located and comparing your premium to that of similar properties  nearby will be the most accurate assessment and point you in the direction of the most aggressive carrier. Good insurance brokers can certainly assist with this as well. Also important to compare apples to apples. There can be significant deviation in coverage for two 4 unit buildings in a specific market. Also loss history can play a significant role.