Insurance questions

[Ken Hughes]

We are closing our first buy and hold property and need some insurance advice. The property is held by an LLC in Florida and we need suggestions as to which insurance companies are best to work with as landlords for price and quality. Typically with insurance I go with the highest deductable, is this wise with rentals? Any other best practices would be greatly appreciated. Thanks for any suggestions and feedback.

[Bill Gulley]

Hi, Ken, I can't advise as to which insurance company to work with, but, as to any deductable:

With any property casualty or liability policy the higher the deductable the less the premium is. The difference in savings could be viewed as an investment over time and your break even point can be established if the are no claims. But, then that's what insurance does, it indemnifies us for unforseen losses. The gamble here is do you have the funds available to self insure that portion of your loss and what are you really saving by taking the higher deductable? Anything beyound your break even point, without a loss, is then a savings. Do you sleep well at nights while assuming risks? I do and in the past fifteen years I can only recall two claims. Consider too your area, how often do you have bad weather or other insurable event. The main concern for landlords is the liability portion and such policies provide coverage on a first dollar basis. You might look into an umbrella policy for all of your properties. Bill