Homeowners insurance Florida

[Fradel Barber]

I put an offer on a SFH that was previously self insured.

Does anyone have any tips, what to look out for, how I get a quote or the process of getting it insured if I end up purchasing the property?

Also if you know of any reliable P&C agents in Florida please let me know.

Thanks!

[John Mocker]

Fradel,

My advise is always to seek out several Independent Agents.  If you can get referrals to agents you have experience in Real Estate, Development, Construction, or Property Management that would be helpful.  Contact them and get a feel for their knowledge in the market/operations you will have (Fix & Flip, new construction, buy & hold, etc.).  Also find out how easy they are to work with.  Have them run quotes on this property and the recommended coverage.  Be wary of low price as the only factor they are looking at.  Often, that leads to poor coverage which can be costly if you do have a loss.  

Below is some info that I posted in the past. It may be helpful:

Here are some things to look out for from an Insurance prospective:

1. Any in-ground tanks (active or inactive)

2. Any Knob & Tube or Aluminum Wiring

3. If built before 1978, does the building have Lead Safe certifications

4. Any wood stoves or secondary heating units. If so, were permits pulled & were they

installed by a professional

5. Are any of the homes rented to students

6. Is there a flat roof

7. are there asbestos shingles

The Year that the following were updated (either partially or fully) would be good to know:

- Heating systems

- Roof

- Plumbing

- electrical

Some companies will not write properties with systems that have not been updated.

If the property is solely tenant occupied you will be looking for a Dwelling/Fire Policy (may be called a Landlord policy or similar name) or a commercial policy such as a Businessowners or Package policy.

Most dwelling/fire policies include or can have these coverages added:

1. Dwelling (Building coverage)

The limit should be based on the Replacement Cost of the building (cost to rebuild with

the same kind and quality excluding the foundation)

2. Contents (Personal Property): most homeowners policies give a set % of the Building

limit for Contents. Dwelling/Fire policies require that you request a limit for contents.

3. Detached Structures: for other buildings on the property (ie. sheds & detached garages)

Again, there is normally an included limit of 10% of the building limit. That can be increased

if needed.

4. Loss of Use / Loss of Rents: Normally, there is a 20% included limit. Loss of use is for

your additional expenses if you can not live there due to a covered claim (ie. Fire). The

Loss of Rents is for the loss of Rental income if the tenants can not occupy the house

after a covered loss.

5. Personal Liability: For claims due to Bodily Injury or Property Damage that you become

Liable for and which is covered under the policy. Companies normally offer limits up to

$500,000 but some offer $1,000,000. Buy the max.

6. Medical Payments: Provides coverage for an injury suffered on the premises. Does not

require proof that you were at fault. Used to keep small loses into becoming lawsuits.

Normally offered up to $5,000 but check to see if higher limits are available.

7. Deductible: This is not a coverage but rather your portion of a claim. Most better policies

will not have a deductible for either the Liability or Medical payments coverage. It will

apply to the other 4 coverages. You can select the amount of the deductible, usually

ranges from $500 to $5,000. The higher the deductible the lower your overall premium

but get quotes on all the deductibles you are interested in. Sometimes the incremental

savings from $1,000 to $2,500 or from $2,500 to $5,000 are too small to make the higher

deductible worthwhile. ***depending on how far the house is from the coast, you may

also be required to have a separate Wind or Hurricane deductible. Most times, the

deductible will be 2% to 5% of the building value. That is a significant amount

(on a $500,000 building that comes to $10,000 for 2% or $25,000 for 5%). A policy

with a higher premium may be a better deal if it does not have a wind deductible.

There are many endorsements that are available on the homeowners policy. Without

knowing the details I can not suggest which would be right to add on.

Several you should pay attention to are:

- Ordinance & Law: Provides additional building coverage to deal with rebuilding cost

Increases due to changes in Zoning or Building laws

- Personal Injury Liability: Libel, defamation of character, wrongful imprisonment, etc.

(normally recommended, especially if you are a landlord)

- Water Backup: For water damage due to the backup of Sewers or Drains.

Good Luck & feel free to PM me if you have any questions.