I was reading an article (from the REI Expo magazine, if you're curious) and it mentioned "coverage against rental income interruption" and "tenant-paid rental protection plans.

Flood coverage can be substantial, so always get a firm quote. 

No coverage for damages from "Business pursuits or business property of an insured" Is 'renting' meeting the definition of business pursuits?)

It's just an exclusion from coverage.  

That being said, given that flipping is a pretty risky activity, one still benefits from having several layers of asset protection, including an LLC structure, as well as liability insurance coverage.

Hope I caught you in time, I suggest you not follow any of this advice, see your attorney. 18% my rosey red, check on usury laws, there are differences between those in business and individual sellers.Having been involved with more CFDs than anyone here, I'm sure, 10% interest is and has been the standard for over thirty years in the mid-west.The problem with hazard insurance becomes an issue if there is an underlying mortgage with the seller, if it remains in the seller's name as owner the buyer needs a tenant/renters coverage, if it goes to the seller, the bank sees the new insured.

Liability coverage is cheap, make sure you have enough.

My only complaint is lack of coverage in certain markets.  

Frank,Under the Statutes in CT (NJ is probably similar), you are required to provide Workers Compensation coverage for any employee. 

I like the concept, though our insurance coverage provides a considerable portion of what they claim to cover (which is perhaps one reason they are not operating here).In some jurisdictions, such as ours, the landlord would en-up eating the premium costs as we are legally not permitted to collect any other fees other than the sanction security deposit which must be remitted to the Office of the Rentalsman.