AFTER the Disaster - Financial Preparedness

[Sean Dargie]

Hello, Everyone!

Thank you for taking the time to read and respond to this post.  I have gained much knowledge and confidence from this site and community already and am hoping to do so again.

Do any of you investors/landlords who do business in places that have had or are at high risk for natural disasters take special financial precautions for yourself AFTER the disaster has passed?

(Quick background on where I'm coming from with this.)  I live in Panama City, FL and watched from my evacuation site as the eyewall of Hurricane Michael traveled directly over my house. While my wife and I were proud of the planning we did for an emergency evacuation kit, we quickly realized that we had never even considered planning for returning to a destroyed house and city. Some items that are hard lessons learned that I have been paying attention to as I learn about REI are as follows;

• Insurance can be incredibly slow to pay out (we are still displaced from our home and not able to pay for both rent and a mortgage out-of-pocket anymore)
• Federal programs that should be there in times of need like this may not be (FEMA won't help until the insurance claim is finished and those I know who flexed the SBA loans to help float them until insurance paid are wishing they hadn't)
• The timelines for repairs, availability of repairmen, and cost of materials has skyrocketed around here.
• Local businesses have closed because their employees left the area and there weren't enough people to keep the doors open. (Fast food places are even offering sign-on bonuses to attract workers)

I have looked through these forums already and found some related discussion about notifying tenants for an upcoming disaster or using the SBA loan to help with repairs, but nothing about setting yourself and your property up for success in a known disaster area.  So what I mean more specifically from my opening question;

• Do you plan for extra CapEx or Emergency funding to pay for repairs out-of-pocket to get a tenant back in your property as quickly as possible while the insurance catches up?
• Do you plan for extra Vacancy Rates to ride out insurance so there is no out-of-pocket expense?
• Do you plan upgrades to your properties to include items like hurricane shutters to protect your investment and your tenants home to mitigate as much damage as possible?
• Do you have a rule-of-thumb in place for determining your rent when the market has gone haywire around you?
• Do you plan for any kind of displacement funds to put your tenants up while your property gets fixed in an effort to retain a long term renter?
• Do you have any legal accountability as a landlord for tenants that choose not to evacuate when they should have and something horrible happens?

I know this whole experience has shown me many aspects of planning that I would never have thought of on my own without experiencing them first.  Hopefully, at the very least, my questions may spark something in your planning that improves your investments.  Again, thank you for taking the time to read this and perhaps offer some insight.  I appreciate what wisdom you choose to share.