any experience with NREIG

[Ari Bachrach]

I've heard a bunch of insurance horror stories lately, so I just wanted to see if people had experience/opinions on NREIG. I like the fact that they're clearly investor friendly, but I just want to make sure their service and coverage is good too. 

TIA

[Alex Dem]

@Ari Bachrach Alright, here is my outcome on NREIG. I am most likely not going to do business with them and here is why: I ran an what if scenario with them and it didn't make financial sense. Here are quick details:

We bought the property for 115k from foreclosure auction, spent another 5k between past due taxes (welcome to CT :D) and cash for keys.  The property is worth around 200-205.

Our rehab will be roughly 25k, so our cost basis is roughly 140k and that is the MOST nreig will write a policy for you - just whatever you have spent so far.

Here is a what if scenario: the house bursts in fire. The policy will cover our cost basis (140k) minus land ( and they think it is worth 75k), so technically they only write a policy for 65k( 140-75), that is why they are relatively cheap. BUT here we are stuck with 60k cash ( 65k recovered by insurance minus deductible) and a parcel of land with a burnt house. 

They don't take into consideration that land doesn't sell fast, and it will need substantial capital for demo work to get lot ready to sell to builder.  I am a realtor and I will not value that lot anywhere higher than 50k (0.3 acres) minus 5k in demo, we have 45k - so we will net 105k in case of a total loss, missing 35k  we have invested so far (140-105)