Insurance for first Flip

[Alfredo O.]

As we move towards buying our first flip, can you all provide helpful input on the type of insurance we need as we own these properties?

These are all flips.  So if everything works as it should, we should only own these locations for 3 to 4 months.

Location: Texas (DFW)

Thanks

[Nick Baldo]

Alfredo, 

Insurance for flips can be a bit difficult to find. This is mostly due to the fact that the home will be vacant and undergoing construction. These homes are seen as a greater risk. That being said, there are certainly several carriers that offer the insurance. You just need to shop around. 

I recommend contacting an independent insurance broker in your area. Explain the situation and be prepared with key facts about the house: Sqft, status of electric, heating system, roof, age, etc. Be completely transparent. There is no point to getting an insurance policy if you knowingly lied to get the coverage. 

You will pay an annual insurance premium. You can pay the whole year up front, or choose a payment option to break it into 4-10 payments (small fees apply). Just keep in mind that if you are getting private financing for the deal, your lender may require you to pay insurance for the year in full. Once you sell the house, notify your insurance agent. He/ She will help you to cancel the policy. You will be reimbursed with the % of annual premium that you did not use. 

Hope that helps! Let me know if you have any specific questions!