Insurance/Self Insurance options?

[Ryan Zaninovich]

Hello everyone,

I'm seeking some information and advice about insuring our rentals. We have a fairly substantial amount of SFRs in our portfolio, many of them lower cost houses in different cities in Michigan. The problem is that these houses are only worth between $25,000 and $50,000 yet the lowest cost insurance I can find is around the $600 to $700/year premium range and that DOESN'T include replacement value. So we are paying $650/year to insure a house that is worth, say, $30,000. Why? Because we want/need liability coverage. To make things even worse, the carrier we are currently insuring with is issuing cancellation letters for various houses based on suspect inspection and findings like roofs etc. I hate that tactic because once they get you to sign the bottom line they go out and cherry pick the best houses that they want to insure. Personally, I think it's unethical.

My question is, can anyone point me in the right direction for an insurance agent/carrier that is better suited for landlords with large portfolios like ours?

And...We would love to take the risk of fire and other issues by self insuring, but we don't want to (and it seems foolish) to self insure the liability portion. I mean, we are willing to self insure the liability up to a certain point but after that point we would like to be covered for any really big issues. I have not been able to find an insurance carrier that is willing to give us an umbrella liability policy without a basic underlying policy on the asset. Is it possible to get a huge umbrella policy on these rentals (and any other areas of our lives) without a basic policy first?

Thanks everyone!

[Greg Scott]

Wow, that is definitely on the lower-end.  Where are these properties?

I have an umbrella policy for $2M.  It is an adjunct policy from my personal residence.  I've looked and that seems to be the only way to get an umbrella.

For insurance on many of my properties I use NREIG, which is a national insurance provider using co-insurance from LLoyds and other major insurers.  I like them because they can cover multi-state portfolios.  I've found that most of the time they are cheaper than traditional insurance companies, but not always.

Good luck.