Rental Insurance Increase?

Question

Hello everyone,

I had my first claim through my insurance company (AAA) for my rental property. This involved replacing the flooring downstairs. I was given about $8K for the damage to the flooring, wall, baseboard, etc. I still haven't completed the process of getting money back for lost rent (I had to send them a copy of my signed lease). I'm expecting an increase to my insurance when it comes to renewal. What amount should I expect? Should I try to get lost rent (about $1-1.5K) or should I just eat that so I don't go over a certain amount? Thanks for the advice

Jason Bott · Answer

@Matt Lindsey the insurance carrier will be obligated to give you the Loss of Rents. Are they waiting for any documentation to confirm the amount or timeline? They should be able to communicate that to you and give you a soft deadline of when they can send out a check.

Secondly, increasing the claim from $8k-$10k will not have a large impact on your rates.

David P. · Answer

I actually had a water claim from AAA here in los angeles for my rental about 15k claim. This was back in 2019.  I only spent about 7k to do the repairs and pocketed the rest from the check they wrote me. Surprisingly my policy has never gone up for renewel substaintially. I kept thinking the next year it would spike but it has only been very gradual increases throughout the years. But on the flip side if you have more than 2-3 claims it becomes a problem with getting AAA to insure future new properties. I didn't take advantage of the rent loss because i did the repairs while tenants were in the house. Was also entire house flooring, some drywall and some bathroom tiling.  I tried adding new rentals to AAA and they have a 3 year restriction if you have too many claims.

Matt Lindsey · Answer

Thank you so much for the reply.

Bjorn Ahlblad · Answer

@Matt Lindsey you can expect a 10-12% increase next year. I don't think the lost rent claim will change things very much. Have a chat with your agent and ask her/him. All the best!

Rental Insurance Increase?

Most Popular Reply