Updated almost 5 years ago on . Most recent reply
Landlord insurance for SFR
I have put a few offers on my first SFR and waiting to here back. I'm wondering who everyone uses for their landlord insurance and what coverages I should get? Property would be $75,000 and out of state if it matters.
Most Popular Reply
@Brian Stinson congratulations on your first SFR!
For insurance we do a basic fire policy at replacement cost, no personal property included (only personal property would be appliances). We do a $1000 deductible because we are never going to claim anything small. We are thinking of changing to $25000 deductible. Looking at the cost savings with higher deductible, over time we will come out way ahead. Early in my investing career I was dropped from an insurance policy, so I avoid claims unless it is really serious. I really have insurance mostly for catastrophic events like a fire or tornado.
We also have several million dollars of general liability insurance. It is one policy that covers all rentals and even kicks in on our personal or auto.
The insurance industry is very profitable and that is because of a low probability of payout. Like in gambling, the house always wins over time. When landlords have enough properties, they usually switch to self-insured at some point.