Landlord insurance Policy for LLC

[Sam P.]

I created the LLC and have transferred the title to the LLC. When I called Allstate and asked them to transfer the property to the LLC, they are saying that AllState policies does not allow a business to be listed as the owner of the policy. They are saying that the LLC can be added as an interested party to the policy and that will be sufficient. Nothing changes as far as claims are concerned, in case of a claim the payment will be made to me as the owner.

Should I be concerned about this ? Do I need to get a commercial policy for my property? 

[Matthew Olszak]

If they are listing your LLC as an "Additional Insured", you might be good (of course dependent on policy language). But if they mean your LLC is simply a "certificate holder", hell no.

However, you should really connect with an insurance broker to get you some quotes. Allstate and State Farm in Illinois lately have been huge a**holes as far as providing coverage when a loss occurs. If you are only getting "fake" feel-good coverage through them, might as well get a skeleton policy from someone much cheaper. Or if you value coverage, look to other major insurers.

[Miranda LeMaster]

Quote from @Sam P.:

Do I need to get a commercial policy for my property? 

Curious what you ended up doing Sam. Did you go with commercial insurance? I'm having the same issue all my Landlord policy quotes take my LLC information but then ask about myself and other LLC members and say if we bundle home and auto it could be cheaper. I purposefully don't want them bundled hence the LLC!

[Jason Bott]

@Miranda LeMaster
If your agent can not offer you a good commercial option, then you are working with a personal lines agent and you may want to think about making a change sooner than later.

Ideally you want to have 2 separate insurance programs.  1 for your personal and 1 for you business/commercial exposures.  

The draw back when starting out is there can be some cost savings with "bundling" everything together.  This works until you get to 5-10 locations.  At that point you will hit the max # of rentals your Home and Auto policy can handle.  Right after that, your lending will change to commercial and they may not allow the personal lines policy forms. Basically, if you are going to keep growing your portfolio, it's inevitable you will need to find a commercial agent to develop a solid commercial program.

[Joe Splitrock]

Quote from @Jason Bott:

@Miranda LeMaster
If your agent can not offer you a good commercial option, then you are working with a personal lines agent and you may want to think about making a change sooner than later.

Ideally you want to have 2 separate insurance programs.  1 for your personal and 1 for you business/commercial exposures.  

The draw back when starting out is there can be some cost savings with "bundling" everything together.  This works until you get to 5-10 locations.  At that point you will hit the max # of rentals your Home and Auto policy can handle.  Right after that, your lending will change to commercial and they may not allow the personal lines policy forms. Basically, if you are going to keep growing your portfolio, it's inevitable you will need to find a commercial agent to develop a solid commercial program.

 That 5-10 limit must only be certain insurance companies. I have well over that in personal policies, plus a blanket liability policy riding on top of it.

[Miranda LeMaster]

Quote from @Jason Bott:

 Basically, if you are going to keep growing your portfolio, it's inevitable you will need to find a commercial agent to develop a solid commercial program.

Yep I think you're right. Any suggestions for companies with commercial policies? I've called back the two I spoke with already (Liberty Mutual and Allstate) and asked to speak to someone about commercial. It's so strange to me that something titled Landlord insurance wouldn't be commercial from the get go. I really thought that was who I was already dealing with but it's not. 

[Jason Bott]

@Joe Splitrock it's different for every company.  Some it's as low as 2.  Keep in mind you can have a policy in your personal name covering a single family rental and it is on a commercial form.  If they ask for your Date of Birth, then it is a personal form policy.

@Miranda LeMaster yes, those are both carriers who's main focus is Home & Auto.  Nothing bad about either of those companies, but if you don't fit in the box, your out of luck.

[Megan Templeton]

@Sam P.

No concerns - as long as the titled owner of the property (ther LLC) i listed as an additional insured or interested party you will be covered.

Thanks,

-Megan

[Henry Lazerow]

I have an awesome insurance agent that will do LLC. Shoot me a PM with your email and I can connect you. I use them and many of my clients.

[Michell Chase]

@Henry Lazerow. I know this post is old, but could you shoot me your insurance agent if they cover NY?