All Forum Posts by: Michael Norris

Many HOA's have no teeth to enforce what they are telling you to do. Talk with an attorney about the concept of estoppel and see if there are other rented properties in that HOA. If so your attorney may be able to send a letter or make a phone call telling them to back off. *I am NOT an attorney NOR should this be considered legal advice*

What ever you decide on - take action ASAP - don't just let it sit there.

Chances are you bought a landlord policy that will not cover the place if a loss occurs while vacant (unoccupied) so you should probably have a chat with your insurance agent to make sure you have proper coverage too.

Good luck!

Is the insurance company making an >initial< payment to you for Actual Cash Value of estimated damages and now waiting for you to make repairs so they can then then reimburse you up to the replacement cost (minus the deductible)? Also the way you typed it looks like you made multiple water claims versus one large claim event - if you have multiple claims you'll also have the deductible applied to each one as a separate event.  

Without a lot more information than is appropriate for this forum the only thing I can suggest is to hire a public adjuster as you mentioned or lawyer up. Either one is going to charge you a portion of what they are able to obtain on your behalf.  

Have you spoken to your agent to get them involved? As an agent myself I'll say upfront that the agent doesn't have any power over the claims department check book >>but advocating for the client is the agent's job in a situation like this. A lot of adjusters are totally overwhelmed with dozens of claims to handle at a time (no excuse) but that being the reality your agent should be able to get some extra attention to your case. Take lots of photos of the current situation which will help justify accessing the loss of use coverage and getting your family into a hotel while the damage is repaired. If you still aren't getting what you need go up the ladder to the claims supervisor. This is where the photos come in handy - adjusters are like cops they have people like to them all day long/ supervisors doubly so. Showing photos of your jacked up living space says way more than all the words you can express on a phone call.

@Aaron K. No worries - agree to disagree. I can't speak for California but I can speak for Ohio because I'm an insurance agent as well as an investor. 

I wish it was not this way but the policy premium on an apples to apples same house can go from $500 a year to $1200 a year just by changing the zip code. I won't say it's right but they make the rules we just get to play the game.

I tell my investor clients not to shop for an investment properties based on the cost of insurance however if they are comparing multiple properties I can let them know which one will cost the least as far as insurance goes.

My rule of thumb for lower rates - Typically construction newer than 1950, brick exterior, outside a particular set of zip codes will get the best possible landlord policy rates.  

In the hottest REI areas in Ohio though what you mainly see is pre-1930, wood frame, wood / vinyl siding, sketchy wiring, and old plumbing and if there were updates completed they didn't pull permits or keep any paperwork that would allow us to credit for the updates.

Unfortunately there is no generalized average for a whole state, city, or county.  Insurance rates will vary by zip code, age of construction, type of construction, how many units are in the building, etc. Then you can pick up discounts for things like belonging to a landlord association, using a property management company, requiring tenants to keep renters insurance and keeping a copy of their policy on file, and lots of other random stuff. Find an agent familiar with investing and they can walk you through this stuff. 

It sounds like you are on the right track. On the broker vs agent instate vs out of state - to me it comes down to the quality of the policy issued and the level of service that agent will give. 

It's possible to have policies with the same dollar amount of coverage but be completely different on how they settle a claim and not even cover the same types of losses. 

The $850 price sounds about right - I see landlord policies as low as $500 and as high as $1500 per year depending on the underwriting details.

Assuming the price is exactly the same between your quotes - If I was you I would be looking for the best possible coverage amount / settlement terms for the price paid.

Also once you think you have a final choice selected - make sure the numbers you are looking at are the real numbers and not what I call shopping numbers that then go to underwriting for review after the policy is issued. Sometimes you can sign off on what looks like a great deal only to find out a couple weeks later it's not so good.

Does the policy offer Replacement Cost Settlement (RCV) or Actual Cash Value (ACV)? 

*Side note some policies may offer "Repair Cost" settlement which is a nice option that falls in the middle of RCV and ACV and may not require you to insure the dwelling at the full replacement cost estimate.

For those outside the major Ohio cities you may have a small stroke hearing someone say to insure it for less than the full RCV. I don't disagree but reality is you may have bought a 3500 square foot, 100+ year old brick duplex in crime ridden part of town for $30,000 that would have a reconstruction cost estimate of $390,000 to $450,000. 

Many companies will not even write you a policy in that situation because the market value vs replacement cost estimate is WAY too far apart from each other. That is where a "repair cost" type policy may benefit you over an ACV policy.

You can google search the difference between RCV and ACV coverage and get a pretty good explanation on that.

Ask how they carrier will settle a total loss vs a partial loss? 

Next look at the amount of coverage on the dwelling itself (Coverage A) - is this set up at the full replacement cost estimate amount to rebuild the property? 

A very rough rule of thumb I use in Ohio is about $130 per square foot for reconstruction cost estimates to double check what the software says it should be. Some are as low as $100 per and some higher depending on the age, zip code, and build type (frame vs brick, basement vs slab, etc)

If you are insured for less than the full replacement cost estimate amount - will the insurance company apply a co-insurance penalty to any losses?

@Peter Ledger Unfortunately the OREIA is not in the stars for me this year but I'm committed for 2019 to making it happen.

Your best bet may be to open up a US credit card and pay the premium with the card and then make payments on the card. I think your local Austrailian bank should be able to set up something with a reciprocal agreement with a US bank so you can get a card with favorable payment terms.

Foremost Insurance offers a short term/vacation rental policy - you should be able to find a local Independent or Farmers Agent who can help you.

As a an agent insuring lots of investor properties in Cleveland I love all the out of town attention we are getting however also being an investor here you west coast RE investors are making it harder and harder for me to find the deals! LOL

Welcome to the party.