Quality insurance coverage is necessary now and with the LLC.Your lender is referring to your maximum allowable mortgages backed by fannie / freddie.

I'm looking for some advice from the seasoned investors and insurance experts.I've got a quote that actually beat my pro forma, however just like anything they are now offering the "add-ons" and upgraded coverages (service line coverage and equipment break down coverage to be specific).So my question is, where do you draw the line between coverage's that can save your butt if something were to go wrong, and where can you save a dollar here and there and rely on your Maint/Capex/cash reserves to cover the unforseen issues in owning a rental.Also if anyone is so inclined, if any, what are THE additional coverage's to get when insuring a rental?

@Vanesa Gonzalez - a $1M/$2M General Liability policy, with some form of a medical payment coverage provision, is somewhat a standard insurance policy for most businesses, and generally fairly inexpensive.

Hi all,I know Geico Umbrella policies have been discussed in numerous posts in these forums previously with regard to multi-families, and it always seemed that the consensus was that they provide decent coverage and potentially asset protection for landlords for up to 4 multifamily properties.  

Their coverage forms are too restrictive and the pricing is usually high.True Vacant Building coverage most often excludes any occupancy or renovation activities.Builders Risk policies allow vacancy and renovations. 

Now as an additional insured, you know they have proper coverage and you will be notified if anything about that policy changes in the future.

.** Purchase & Rehab **Purchase Price: $85,000After Repair Value: $110,000 (the tax assessment was even higher then this but hoping to refi and pull as much equity out as possible, unsure of how the city and bank assess the property and if it's different though, I need to look into it more)Purchase Costs: $2,550Rehab Costs: $2,200Down Payment: $17,000Total Cash Needed: $21,750** Financing **Loan Amount: $68,000Loan to Value (LTV): 80%Loan Term: 30 YearsInterest Rate: 3.75%Monthly Payment: $315** Cash Flow (Monthly) **Rent: $1,250   (possibly more this is on the low end for 3 bedrooms, and even lower for a stand alone house, but trying to be conservative in that the house is on a really small plot of land and has a cliff on 1 side)Vacancy: -$63 (5%)Expenses: -$339 (28.6%)NOI: $848Mortgage Payment: -$315Cash Flow: $533** Returns & Ratios **Cap Rate (Purchase Price): 12%Cap Rate (Market Value): 9.3%Cash on Cash Return: 29.4%Return on Equity: 14.2%Return on Investment: 105%Internal Rate of Return: 105%Rent to Value: 1.5%Gross Rent Multiplier: 5.7Debt Coverage Ratio: 2.7I had budgeted for 6k for renovations but realistically it probably only needs 2k, it's basically perfect the way it is right now just a tiny bit dated in that it has oak cabinets and wood grain molding.

If it doesn’t, buy it in your name personally and make sure you have plenty of umbrella coverage. 

Then I read the actual coverage and discovered the third company was providing twice the liability and up to a full year of lost rent income, which the first two companies didn't provide at all.

While I am not Batman, I can help Realestate Investors and Agents find Comprehensive PPO coverage that won't break the bank.