Commercial Zoning And Insurance On A Residential Unit?

[Dave Jackson]

I own a fourplex in Indiana that is zoned residential and thus taxed and insured as a residential dwelling. I am in the process of purchasing another fourplex, about a mile away in the same zip code, but for whatever reason it's zoned as 4-19 family apartments. The property has no commercial business or storefront. The only thing that differs between the two properties is the new one has a common area stairwell that leads to the two upper units. My current fourplex has four completely separate entrances and the two upper units have their own stairwell. Not only are the property taxes higher on this new property, but my insurance broker told me I will have to insure it via a commercial policy. The cost of insurance is about $800 more a year. The new property is newer and smaller than the one I currently own, so how could it be so much more expensive to insure and why are they requiring a commercial policy? Also, how could property taxes be almost a thousand dollars more each year? Is this really all because of a common area stairwell?

Does anyone have any advice on this or recommendations for insuring it? I currently have Travelers, but according to my broker they won't insure it because they're deeming it a commercial property. It seems like a strange technicality to me especially since there’s more potential liability because of the age and square footage on the current property I own. Are there any recommendations for getting this rezoned as a residential dwelling with the county? Many thanks!