Rent Guarantee Insurance vs Holding 3-6 months of Expences

[Phillip Faries]

Hi All, 

Does anyone use Rent Guarantee Insurance? Right now I'm holding around 6 months of expenses, just in case the tenant doesn't pay or if any repairs are needed. Currently my reserves are around $15k for 2 condos. (only responsible for maintenance on the inside)

My thought process is, rather than holding $15k in cash, if I'm able to buy Rent Guarantee Insurance, then I should be able to free up some of that cash (50%) for down payments or renovations, while still holding on to the other (50%) for any surprise repairs within the condos.

Any thoughts or advise on this strategy?

Phillip