Best way to insure fix and flips

[David Lehane]

Hello, we set up a LLC and have now secured a few fix n flips, does any one have a suggestion or can offer guidelines as to what's the most cost effective way to insure these, is there a company that does blanket policy or do I do each property? Also does any one know who can be trusted if such a thing exist in Insurance?

We are based in Michigan as well.

[Kevin Romines]

I used to write builders risk on these policies, but I really dont like builders risk policies for a few reasons. They generally don't provide liability coverage as well as theft or vandalism. They are fully earned premium, so no matter how long you have the policy (1-4 months) before you sell or hold as a rental, you will not get any of the premium back?

I switched a long time ago to Foremost vacant / rehab policies, for many reasons. You can get liability, theft, and vandalism coverage on these policies. The minimum earned premium is $250.00 ad so I set my flippers up on a monthly payment plan if I can and once they have used up the $250.00 in premium, they can switch it to a landlord policy if they are going to hold the property. If they are going to sell, then the pay the remainder of the $250.00 and that's it?

As far as a blanket option, they don't really have that option, but they don't have a limitation on the number of properties you can insure. They will write individual policies on a blanket format with a max. of 35 properties on it, thereby saving you monthly service charges.  This also makes the dec. page 1 overall dec. page, so in a lot of ways easier to work with. 

Foremost is primarily concerned with the shell of the home, so tell your agent the scope of the work and plan to get all exterior work done 1st. Oh and Foremost has no issues writing a personal lines policy in the name of your entity, many companies will not do that?