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Updated about 6 years ago,
Do I need liability insurance for a flip on the market?
Hello all, this is my first time posting although I have been making great use BiggerPockets for a while. I am new to REI and closing on my second flip in just four days! Just as a little background, my first flip was with two partners, one of whom purchased and insured the property. She has since bowed out, so this time I am making all of the business decisions myself.
I have already purchased Builder's Risk insurance for the property which does not include liability insurance. My contractor, who is my second partner, does have liability insurance, but of course this only extends to his workers and subs. My concern is that when the house is on the market I will not be insured for accidents that occur on the premises during showings or open houses. This issue came up because I actually may have a pre-buyer for the house (although I'm not banking on it). She wants to come tour it with her realtor a couple days after I close. My concern is that by letting her onto the property to see it I'm opening myself to a liability issue, which got me thinking about my liability risk when I put the house on the market.
How do the other flippers out there deal with liability while the house is on the market, or before if they are trying to pre-sell? Should I get a liability rider on my Builder's Risk policy?
I appreciate any input the more seasoned of you can give me.