All Forum Posts by: Jason Bott

Quote from @Shane Swart:

Hi All,

I have an existing portfolio of LTR's that are all small multi-family. 8 properties, 25 units total in WI.

We have stuck with the same local insurance company for over 15 years and we are long overdue for a deep dive to find efficiencies and save some insurance costs with the portfolio. We haven't had any claims (knock on wood), however premiums continue to climb.

Has anyone used an independent insurance broker to shop around for an entire portfolio before? Pros/cons? Any recommendations in the Wisconsin Market?

Appreciate any feedback!

Shane

 Shane, we work with investors throughout the US, but I'm based in SE WI.  There are several independent insurance carriers in WI who only write business in WI that are good alternatives to who you are currently with.  I'll drop you a DM with more info.

@Ana Vhan I would also add, a Commercial Umbrella can only go over a commercial policy, not a Personal form policy.   May investor run into this issue.  Depending on the type of policy you currently have on the rentals, you may need to change those over to a Commercial policy to qualify for the Commercial Umbrella.

@Stephanie Heron Weeber The Builders Risk policy is the correct coverage for this project.   A Vacant Building does not extend coverage to improvements made to the building or materials in transit or stored on site.  These additional coverages are the difference in the premium.

Here is a more compete comparison of the 2 different policies.

Feature / Coverage	Builder’s Risk Policy	Vacant Building Policy
Purpose	Covers property while under construction, renovation, or repair.	Covers an existing building that is unoccupied or vacant.
Construction Materials & Supplies	✅ Covers building materials, fixtures, equipment, and supplies on-site (and sometimes in transit or temporarily off-site).	❌ Usually does NOT cover building materials or supplies being installed or used.
Soft Costs (optional)	✅ Can cover financial losses such as interest, permits, architect/engineer fees, advertising, and legal expenses due to delays from a covered loss.	❌ Not available — not designed for construction-related delays.
Increased Cost of Construction	✅ May cover additional costs if building codes change during the project.	❌ Generally excluded.
Scaffolding, Fences, Temporary Structures	✅ Often included.	❌ Usually excluded.
Debris Removal after a Loss	✅ Typically included to clean up construction debris from a covered loss.	🚫 May have minimal or no coverage.
Testing of Systems	✅ Some policies include damage caused during testing (like HVAC or plumbing systems).	❌ Not applicable.
In-Transit Coverage	✅ Can extend to materials while being transported to the site.	❌ Does not apply.
Installation Coverage	✅ Covers materials as they are being installed into the building.	❌ Not covered.

@Bethany Peysen my college in Scottsdale AZ focuses on high end  Personal policies.  I'll send you a dm with her info.

Quote from @Ken M.:

Quote from @Tony Wilcox:

That's great Ken, but no need to watch that video. We will just have to agree to disagree here. Also I wouldn't stay with any agent that does this.

Likewise, agree to disagree. Also, I wouldn't go with any agent that wouldn't watch what a more experienced agent has to say. It's too important of an issue :-) No worries.

One key point often left out of the discussion is whether you have a personal or commercial insurance policy. This distinction is crucial.

Most personal lines insurance carriers and agents—such as Allstate—are required to report claim inquiries to CLUE (Comprehensive Loss Underwriting Exchange). CLUE, managed by LexisNexis, is a database that tracks claims history, which insurers use for rating and underwriting policies. Nearly all home and auto insurance carriers rely on this database.

However, if you have a commercial policy, claims are not reported to CLUE. Properties with one to four units can be insured under either a commercial or personal lines policy, depending on the carrier and their underwriting guidelines.

Quote from @Bruce M.:

I have rental properties in both NV and AZ, all are 1 to 4 unit properties.  Any advice on where I can go get all of them written together?

 Bruce, there are many programs out there that will be able to write the entire portfolio.  I'll send you some recommendations that our AZ/NV investors use.

@Max Servais if this will be your primary residence, you will need to insure this with a Homeowners policy.  A standard Landlord/Apartment policy will not allow the building to be owner occupied, especially if the title is no your personal name.

Quote from @Danielle Crawford:

Thoughts on purchasing a multifamily with fuse boxes..

9 units, so a decent expense to update and the one thing that could make or break the deal.  

Current owner has had no issues in the 6 years of ownership and no issues insuring. The boxes were made by Federal Pacific, but can't find any information on their fuse boxes being an issue-just the breaker panels.

Any experience with these would be greatly appreciated!

Danielle, in order to get reasonable insurance pricing, all of the standard market companies will require the fuses to be updated.  I have seen this requirement being one of the reasons owners are the selling. 

@Matt Wignall I have offices in MN and can say the # of companies willing to insure older buildings has gone from 10 to 1-2 in 2024.  There are a few options out there, but not many.  I'll PM you some info.

Quote from @Michelle Bowes:

We own a residential 10-plex in a small, safe, Nebraska rural community. Our insurance recently off-loaded all multifamily units in the US leaving us hunting for a reasonable replacement. Unfortunately, quotes are coming back at 3x the current cost ($3300/year). Can anyone recommend an insurer that is a bit more reasonable? The building is in great condition with a new roof and is professionally managed. Only 1 claim on our books. Thank you in advance!

Michelle, I have offices in NE and can say 95 % of the companies have pulled out of the market.  The ones still open to adding new policies will only insure buildings built after 2000, or 1980 (depending on the insurer), and you have to be claim free in the last 5 years.

Unfortunately, $9k for a 10u does not surprise me.  No one wants to insure these buildings in 2024.  The clients we have who have been cancelled have needed to go to the nonstandard market, like a Lloyds of London.