Insurance On Small, Older Multifamily- I"m Getting Crazed Quotes

[Burt L.]

HI BP - There is another very similar property nearby that has hazard insurance and cost less than half as much despite being larger, but is 15 years newer. The one I"m trying to get coverage on is a 60 year old brick building. I've tried State Farm who has the other and Farmers and they're over double the cost of the property that is 45  years old. 

Who is writing policies that are competitive in the Colorado market? State Farm and Farmers both admitted they "weren't competitive", which was interesting to hear coming from insurers themselves. 

thank you. 

[Aaron Porter]

Use Google and find a good Independent Agent they will be able to "shop" multiple carriers and can usually find the most economical rates for the insurance that you want. Bonus points if you use an agent that works mostly or exclusively with real estate investors as that agent is going to have a better understanding of your needs for your insurance.

Property Insurance pricing is cyclical.  Meaning that this year company "A" is discounting rates in your area to aquire more business.  Next year company "A" is going to increase the pricing for new customers by 20% (estimated guess) and they are going to send renewal increases somewhere in the realm of 2-5% (estimated guess)  But also company "B" has decided they are going to start discounting rates in the area.  next year it will be company "C", and so on for somewhere around 5-7 years.  keep in mind that you are still with company "A" and they have been sending your renewal increases of 2-5% every year which you were happy about because costs go up every year, and 2% is inflation.  But now 7 years later company "A" is discounting rates in your area but they aren't lowering the cost of your insurance.  You would have to be a new customer to get the new discounted rates.

This is why you should shop your insurance rates routinely, and why having a good independent agent who has access to more insurance carriers is always a good thing to have.  State Farm, Farmers, and American National all have great products but they aren't always going to be the "cheapest"  you have to do the work to shop around or work with an agent that will do the "shopping around" for you.