All Forum Posts by: John Mocker

Paul,

The Insurance policy most likely to fit the project is a Renovation Builders Risk policy.  There are standard carriers and Excess/Surplus markets for that coverage.  The policy provides a limit for the Existing building based on Actual Cash Value (depreciated value).  It also provides coverage for the improvements being made on the Rehab.  

Jesse,

Depending on the situation it may be possible to get some kind of Group purchase.  In the past, I've seen the following:

1. Insurance programs or discounts provided by one company to the members of a specific organization (ie. trade group, alumni group, company employees, etc..)

2. Insurance Purchasing Groups.  These are often used for difficult to insure trades or businesses (ie. medical Malpractice, asbestos removal, etc.).  A master policy may be issued and the group members pay to be part of the policy.

3. Self Insurance.  Large companies or groups fund the claims together and then pay someone to administer the claims.

Let me know more about what you are thinking of and I will let you know if any of the above would be likely.   

Aj,

Look for an Independent Agent (they represent multiple carriers) and have them shop the coverage. The Dwelling Fire Policies for the Condo and SFH may be better with different carriers or may be best in the same. Also, have them quote you for Umbrella coverage (gives addtional Liability coverage above your Home, auto, rental dwellings.

Jacob,

Depending on how quickly you will start the fix up, you should be able to insure the Property with a Renovation Builders Risk.  Because of the condition, you may have to go to the Excess / Surplus Lines market (ie. Lloyds of London and similar).  The policy will cover the Existing Building normally at Actual Cash Value (depreciated value) and the improvements you are putting in at Replacement Cost.  You will also need Liability coverage.  It may be part of the Reno Builders Risk or may be a separate policy.  If your agent can not help with this, PM me and I will see who our companies use in your area.  

Eddie,

There are at least 3 real estate investor meetings in the Fairfield / New Haven county areas.  One is tonight at Pinstripes in the Sono Collection (new mall off exit 15 in Norwalk).  None of them charge.  They would be good places to meet seasoned investors and service providers and they do not have any cost other than the food or drink you purchase.   PM me you email if you want the info on the meetings.

Tom,

From an insurance perspective, ask them about claims and see if they can get "Loss Runs" (reports of losses on policies) for the past 5 years.  It will help you when you are pricing your coverage.  Also, it may point out areas that were damaged that you need to make sure were correctly repaired. 

Daniel,

If you do make the change to the LLC be sure to change your Insurance policy to the name of the LLC.

Joseph,

I think Owen's advise is your best route to finding out how the price compares to other options.  Find another agent (preferably an Independent agent who repesents many companies).  Ask for a comparison based on the current coverage and also any recommendations for better coverage.  Without all the info on the property, it is hard to say if the $1800 is reasonable for a Dwelling Fire Policy.  Factors such as age, fire protection of the location, alarms, construction, proximity to a coast, etc. can impact the rates.  

Some items of info that will help the agent quoting:

1. Loss History.  Did you have any losses and do you know of any under the prior owner

2. Age of the systems:   you mentioned new roof.  When were the Electrical, Plumbing, and Heating last updated

3. Alarms:  Is there a central Station Burglar or Fire Alarm, hard wired smoke detectors or CO detectors, video, etc.

4. Do the tenants have any pets (if any dogs, what breed)

5. Any Trampolines or Pools

6. Any inground tanks, active or inactive

Brandon,

From an insurance standpoint, the likely policies you will need:

1. Vacant Land:

    - If no improvements: you may be able to extend coverage from a Homeowners or Business policy.

    - Once you have made improvements (ie. clearing land, bringing in power, etc. you will probably have to purchase a Liability policy

2. Construction:

    - the most likely policy you will need is a Builders Risk policy.  It covers the building as it is constructed, materials in transit, materials being stored, etc.  It may or may not include Liability coverage so you may need a separate policy for the Liability

Jeff,

I would suggest another questions/request for info to add to your due-diligence:    

"have there been any claims reported to you, submitted to the Insurance carrier, or that you are aware of, during the past 5 years"

I would also suggest that you request that they get the "Loss Runs" (report of claims) for the past 5 years from the current owner.  They can request it from their Insurance carriers.