40-100-Unit Insurance Cost Estimates?

[Marc C.]

In negotiations on a 60-unit. Budgeting $15,000 for insurance; I've been budgeting $250/unit/year when I do pro-formas on buildings of this size. However, I wonder how that compares to actuals that some of you owners are experiencing. Is $250/unit enough? 

Yeah, I know I could call an insurance agent and have him or her get quotes, but I don't own the property yet and don't really want to be a bother at this point. 

[Jason Bott]

@Marc C.

If you do not want to call your agent, you can pull #'s from your current policies.   Take the premium and divide by the property value. This will give you a real rough rate for estimating purposes.

Insurance policies have 2 main area that drive the premium,

1)  General Liability per unit

2)  Property insurance rate per $100 of building value. 

The reason being, the seller may be insuring the 100 unit for $3M, but you will be buying @ $5M.  A combined cost on a per unit basis is not a rating option we use on the insurance side of things, so I don't advise starting there.

If you have a good insurance person who specialize in this space in your area, they will know the 2 #'s above off the top of their head.