All Forum Posts by: Tim Norris

60% of property claims are caused by tenant negligence. If they have renters insurance, you at least have a chance to recoup damage/your deductible. Without the liability coverage their policy would typically provide, the chances to recover such loss is minimal.

Hi Adam,

Co-insurance is an insurance industry term/issue. The typical policy describes it over a few pages. We "synopsized" it in a document. It's on our site, but here's a link to it:

https://www.dropbox.com/s/r6w0q2odc45v68u/Co-insurance%20provision.doc

Hope it helps.

Tim

Jon is spot-on. To elaborate a bit relative to the "fully paid" issue, check to see if any/all "unused premium" is refundable when your project is done. The lowest rate may not be the lowest cost, if it is not...

Hi Adam,

Some points to consider (in no necessary order):

1. Is there a co-insurance requirement?
2. How do I garner Replacement Cost coverage? Do I need it?
3. What clauses for vacancy coverage exist in the policy/coverage?
4. What is the rating of the insurer?
5. Is the coverage able to accommodate multiple properties, in multiple occupancy phases?
6. Can I choose different forms (Basic, Special, e.g.) on a per location basis?

These are from the hip, so hope they help at least!

Tim

Though not technically the same, a "sub2" deal has similar issues that need addressed, relative to insurance. You should be able to extrapolate glaring concerns from this: http://www.nreinsurance.com/Insurance-Issues-for-the-Sub2-Deal.pdf (Mod---I tried to copy/paste the text, but I can't get it to work well...sorry if link is not allowed)... Hope it helps. Tim

Without knowing all the coverage details, that seems extremely high to me as well.

It is really not an issue of "either/or" as an umbrella and an LLC are/could be created for different reasons. Think of the LLC and other work you may do with legal and financial advisers (such as attorneys and accountants) as your "castle walls and moat" around your assets, personal and otherwise. Think of the insurance you secure as an "archer in the watchtower". In other words, the walls and moat should be your foundation as it pertains to protecting you/your assets. The archer (insurance) won't pick off every bad guy that tries to get in, so having the walls and moat is vital. Think of them working together not in lieu of each other. Hopefully this helps!

You're welcome. Will actually be in your area at the end of July. Have a great 4th!

Thanks, Steve. Bryan's proposal appears to be from us, so it's all good. ; )

Kidding aside, it seems in line for what Bryan mentioned.

Hey Paul,

There are carriers and Programs that offer coverage while a property is in the rehab phase, without a "full blown" Builders Risk policy. Some points to consider:

1. Ensure the earned premium is minimal. In other words, if you only need coverage for 30 days, don't buy a 90 or 180 policy with a fully earned premium clause.

2. Avoid coverage that has a co-insurance requirement. If you under-insure, a claim settlement could be subject to significant penalty/diminishment.

Hope this helps.

Tim