arizona
Builders Risk Insurance
Saturday, December 17th, 2011 | Builders Risk, California, Detroit, Flint, Georgia, Illinios, Indiana, Insurance, Landlord Insurance, Manufactured Home, Maryland, Michigan, North Carolina, Ohio, Real Estate, Vacant Home Insurance | No Comments
Example of a Builders Risk policy offered by our agency.
| Product | Builders Risk |
|---|---|
| FEATURES |
|
| COVERAGES |
|
| DEDUCTIBLES | Standard Residential- $500 Standard Commercial- $1000 Higher Options available |
| AVAILABLE BY ENDORSEMENT | Contractors Equipment Equipment Breakdown Environmental Umbrella Workers’ Compensation |
| Wind Buy Back | We now offer Wind Deductible Buy Back coverage on both commercial property and property in the Course of Construction. |
| Premium Financing | 10% Down, 10 Payments |
Would you trust your family practice doctor to perform heart surgery?
Tuesday, June 22nd, 2010 | Landlord Insurance | 20 Comments
Landlord insurance is a complicated insurance contract. Homeowners are usually written on a HO policy form which is a broad form policy. A broad form policy is a “if it’s not excluded, it’s included” policy. That means a loss will be paid unless it is excluded in the contract. Landlord policies are dwelling policies and are usually written on a DP policy form which is different from a HO policy. DP policies are either basic or special. Basic and special have limited coverages. They are a “if it’s not included, it’s excluded” policy. That means the claim has to happen in a way that the policy lists as an included coverage. As you can see, that leaves a lot of open gaps that a homeowner policy doesn’t have.
A DP1 is a basic fire policy and does not cover wind, hail, vandalism, malicious mischief, burst pipes, or theft unless it is added to the policy as an endorsement. A DP3 does usually cover wind, hail, vandalism, malicious mischief, and burst pipes unless it is excluded. The reason dwelling policies are more expensive and have less coverage is because of the unknown factor of the tenant.
An insurance company when writing a landlord policy not only has to take on the risk of the homeowner and the property but they are also insuring the tenant in a way. The tenant could cause a fire, flood, vandalism and the insurance would have to pay a major claim due to a property being rented to an unreasonable tenant. Just like landlords usually don’t see a bad tenant coming in the door when they rent the property and the insurance company has even less knowledge of the person living in the home.
Our point is if an agent is very good at writing homeowners and auto insurance policies may not have the product diversity or product knowledge to give you the coverage you want and need. Some investors are more concerned with cash flow and have a lot of liquidity and are only looking at coverage for major catastrophic claims and they want to handle the smaller repairs on their own. They could buy a stripped down policy for minimal cost and maximize cash flow. Another property owner may be an accidental landlord because they had to move and couldn’t sell the home so they decided to rent it out. That person may need a more comprehensive policy because of lack of experience as a landlord and limited liquidity. The insurance policy will cost more but it provides a greater breadth of coverage to protect the landlord from a potential loss even if it is small.
Sometimes it is better to let the family practice doctor handle the sniffles and the heart surgeon to do the bypass. Sometimes its better to go to a clinic that has different departments that way your records and care is more closely coordinated. Just some food for thought (with a lot of fiber, of course).
Landlord Insurance Policy Discounts
Tuesday, June 22nd, 2010 | Landlord Insurance | 65 Comments
If you are looking for a landlord insurance policy or are thinking about trying another agent to insure your investment home, here is a list of possible discounts you may want to make sure you are getting.
Claims Free Discount- If you are without a claim for at least 5 years, some companies will give you a claims free discount. The downside is that sometimes we talk with clients who aren’t even aware they have a claim on their current policy. I know it sounds crazy but it happens more than you think. I have a great example of someone I spoke with today as a matter of fact. I told them the underwriting report showed a claim for $0. Yes a zero dollar claim. The client told me he had called in a claim because of a broken window and found out it was less than the deductible which was $500 so the customer paid it out of pocket. Unfortunately it is still considered a claim. Just because the insurance company didn’t have to pay for the window doesn’t mean that it’s not a claim. They did pay to send a claims adjuster so maybe that is how they justify reporting the claim. It shows as a claim for 5 years and will effect the rate with any new company he may want to have bid on his insurance. I always tell my clients to get an estimate before filing a potentially small claim because it could cost you big premiums long run.
Multi Policy Discount- Some companies will provide discounts if you write more than one policy with them. It may be as simple as multiple investment properties or as comprehensive as your personal home, auto, umbrella, business auto, and business insurance. It could save you a lot of money and could be more convenient since you will have less agents or insurance agencies to deal with should you have a problem or question. Insurance companies reward customers for their loyalty and trust. Plus they have more premium with a single person or business. They make more money and you save more money. A win-win.
Good Credit or Financial Responsibility Score- Many companies have come to the conclusion that a person who has a good credit score poses a more secure risk. Remember insurance companies work in large numbers. The idea is if you are able to gain a good credit score, you are financially able to maintain your property properly and there is less risk of insuring someone who may be in a desperate financial situation and who may also make a bad decision that may cost the insurance company hundreds of thousands of dollars. That is not to say people with bad credit are bad risks. Many good people have bad credit right now due to the economy and the availability of jobs. The point is insurance companies use many different variables and formulas to evaluate risk and some use credit scoring as part of their pricing model. Not all , but some do.
Year of Home- Some companies will give a discount for properties that are five years old or less. New homes have a much lower rate of claims. Homes older than 1930 may get a surcharge if the policy can even be written at all. Some companies will not insure an older home no matter what the other factors are. Older homes generally need more maintenance. Poor maintenance can result in a major claim.
Safety- Burglar alarm, bars on windows or doors, dead bolts, monitored fire alarm, smoke detectors, carbon monoxide detectors, and a fire extinguisher are a few safety items in or on your home that can reduce the risk of claim which results in a lower premium.
Tenant Screening Discount- This is the trickiest risk factor when it comes to a landlord insurance policy. Even though the owner is the one responsible for the home and its maintenance, it is the tenant who is the ultimate risk of claim in the home. Most landlord insurance policies do not have information on the tenant so they have to assume the tenant is a potential risk. That is why many landlord insurance policies are more than a homeowners insurance policy even though their is less coverage on a landlord’s insurance policy. On a homeowners insurance policy the insurance company knows who they are insuring, on a landlords insurance policy they only know part of the story. However, some companies will give discounts if the landlord checks the tenants credit, criminal background, eviction search, or requires the tenant to purchase their own renters insurance policy. Think of yourself as helping the underwriting department assess a potential risk and the insurance company gives you a discount for doing that.
Membership and Maintanence Discount- Being a member of a landlord association can be a discount. It shows pride in ownership and a certain level of sophistication. A landlord who owns properties as a business can be more aware of potential risks and may have a larger reserve to maintain and possibly handle small claims without involving the insurance company. Less claims means lower rates for the insured and the insurance company. Another discount is having a property manager managing the property. Property managers are hopefully professionals who are responsible for maintaining the property, screening tenants, and making sure the landlord has a well maintained property and tenant. A landlord who is a member of an association and uses a property manager could receive both discounts. AARP, Credit Unions and other organizations can also qualify you for discounts.
This is not an all inclusive list and many companies have their own opinions of what is worth a discount. Don’t be shy and ask, it could save you money. We represent many different companies and each one has their own appetite when it comes to investment properties. We write homes built in the 1800′s and homes with more than 3 claims and brand new homes in great neighborhoods. Give us a try.
What is Flood Insurance?
Saturday, June 19th, 2010 | Flood Insurance | 9 Comments
The (NFIP) National Flood Insurance Program was created by Congress in 1968. The program is for property owners to have protection from the damages caused by flooding. This insurance was designed because of the catastrophic nature of floods and the insurance companies inability to underwrite the risk of flood and be viable enough to pay the enormous claims.
The NFIP is meant to collect enough insurance premiums form the insureds to be self funded and pay all claims from premiums collected. Unfortunately due to the numerous catastrophic claims it has made the program under funded and it has cost taxpayers about $200 million annually to cover the losses. Congress originally intended that operating expenses and flood insurance claims be paid for through the premiums collected for flood insurance policies. NFIP borrows from the U.S. Treasury when losses are heavy, and these loans are paid back with interest. This is why the flood budget is subject to Congressional approval and is only being given 30 day extensions at this time until someone comes up with a better proposal for the future of NFIP.
Floods are not covered by homeowners insurance policies. It is a specifically excluded coverage. Wind, hail, and sewer and drain back up coverage are often confused with flood insurance. If rain comes in the home as the result of wind or hail damage, the homeowners insurance policy may cover the claim if it covers wind and hail claims. If the water is the result of a sump pump failure or too much water for the sewer and drain to handle, the water backup may be covered if the coverage is purchased by the homeowner and is on the homeowners insurance policy.
So what does Flood insurance cover. According to www.Fema.gov, here is a list of what kind of flood would qualify for coverage:
CAUSES OF FLOODING
Every part of the country is at risk for flooding from several causes. Some causes are seasonal, but other causes can happen at any time and are always a possibility.
Coastal Floods/Storm Surge: Winds generated from intense storms can cause widespread tidal flooding and severe beach erosion along coastal areas. Storm surges are large waves pushed toward the coast by strong winds associated with the storm. When combined with the tide, storm surges can cause water levels to rise up to 15 feet or more, deluging coastal communities. Hurricane-force winds can bring these large waves crashing into coastal communities in the summer months and nor’easters can
bring these waves to the Northeast in the winter.
Winter also brings strong storms to the Great Lakes. Winds can push water levels up at one end of the lake, causing a storm surge and decreased water levels at the other end of the lake. As the winds subside, a pendulum effect begins until the water levels have returned to normal. These oscillations or seiches can cause coastal flooding on both lakefronts.
Inland Flooding: Inland areas are also at risk for flooding from hurricanes. Slow-moving and stalled systems can
dump large amounts of rain, causing devastating inland floods days after a storm makes landfall and hundreds of
miles away from the initial strike zone. For example, in 2004, inland flooding from Hurricane Ivan caused more
than $115 million in paid flood losses in Pennsylvania.
Riverine Flooding: Riverine flooding generally occurs as a result of precipitation or snowmelt. Rivers and streams
become inundated by water causing them to spill over their banks.
Flood insurance is offered by insurance agents. An agent who can write flood insurance in their own state can write flood insurance in every state since it is a federal program. We write flood insurance in all 50 states and can help you if you need coverage. While flood is suspended due to congress failing to pass a new budget or extension for flood no one can write flood insurance through the NFIP. There are a few insurance companies that write flood insurance for areas not covered by FEMA whether it is a nonparticipating community or FEMA is not allowing new policies to be written through the program.
Is a Tenant Covered on a Landlords Insurance Policy?
Monday, June 14th, 2010 | Landlord Insurance | 19 Comments
This is a very common question asked by tenants and landlords. Most people who are renting their home from someone else my have little or no experience with insurance or may have never needed to make a claim so they are unaware as to what is covered by a landlord insurance policy or a renters insurance policy. Hopefully we can put together some information that can be helpful to the tenant and the landlord when thinking about what insurance to buy.
Landlord Insurance
A landlord insurance policy is designed to insure the interests of the landlord. The landlord owns the building and receives rent from a tenant if the property is occupied. In the event of a fire the landlord can suffer losses to include damage to the building, damage to other structures like a garage or shed, loss of rent if the tenant can’t live in the property due to a covered loss, or even a liability claim should someone get hurt on the property and the landlord is found to be negligent. Now lets break down the coverages a little more to make it a little more clear.
Building or Fire Insurance. A basic policy will insure the building for damages resulting from a fire. The fire can be the fault of the landlord, the insured, or something else entirely. Other hazards that may cause a loss are wind, hail, vandalism, malicious mischief, and leaky pipes. Other hazards are not automatically covered on a basic fire policy and may have to be purchased in addition to the fire coverage. If the loss is the result of the tenants negligence the landlord may be covered as long as the policy is written as a tenant occupied property and the cause of loss was a covered peril. Perils can be fire, wind, hail, VM&M, or leaky pipes.
Other Structures. This coverage is for any structure owned by the landlord that is not attached to the house. A detached garage, shed, or fence would be an example of an other structure. All the hazards or covered losses would be the same as the building coverage. Other structures is not always an automatic coverage and may have to be purchased separately on the policy.
Landlords Contents. This would cover contents of the landlord to include a stove, dishwasher, or other appliances or property owned by the landlord and left for the use of the tenant. This property is covered on the contents portion of the landlords policy up to the specified limit. Not always an automatic coverage and may have to be purchased separately on the policy.
Loss of Rent. This is often a misunderstood coverage. Loss of rents provides coverage for the landlord if the property is damaged due to a covered loss and the tenant can not live in the property until it is repaired. The loss of rents pays the landlord lost rents that they can not collected from the tenant because the house is unlivable. The coverage does not provide housing or living expenses for the tenant, only the rents the landlord can not collect from the tenant while the property is being repaired. Coverage for the tenant to provide housing is covered under a tenant or renters insurance policy which we will discuss later in this post.
Medical and Liability Coverage.These are actually two different coverages and are usually tied together. Medical coverage can be thought of as first aid coverage. Provides an injured person with basic medical coverage to the amount stated in the policy which usually starts at $500. It could be more, depends on the policy amount. Liability insurance would be for more extensive medical treatment and/or pain and suffering. This is the amount a person, either the tenant or a guest, could sue the landlord for injuries caused by the property of the landlord. Common lawsuits brought against landlords are for poor maintenance of the sidewalk, driveway, porch, or the home. Cracks, missing rails, or other property hazards can result in a liability claim to the landlord. Even if the person was a guest of the tenant, the landlord can still be responsible for their injuries.
Many landlord insurance policies offer other coverages also. Additional policies may have to be purchased if you need earthquake, flood, or mine coverage. These are federal programs that are sold by insurance companies but are not usually covered under a landlord insurance policy.
Renters Insurance or Tenant Insurance.
A renters insurance policy is a policy purchased by the tenant and is separate from the landlords insurance policy. The renters insurance policy covers the contents owned by the tenant, loss of use due to a covered loss, tenants fire legal liability limit which actually provides coverage for the landlord, and liability coverage should someone be hurt or injured due to the fault or neglect of the tenant. A typical renters policy will cost about $10 to $50 a month depending on the company and the coverages offered. Now lets break these down a little more.
Contents. This is coverage is for a tenant should they lose the things they own due to a covered loss. If the home catches on fire and the tenant has damage to their clothes, furniture, and other possessions, the policy would cover the loss up to the amount of coverage. A basic renters policy will usually cover $10,000 of the tenants possessions but can be more or less.
Loss of use. This is almost like the loss of rents coverage except the tenant is the person who receives the benefit. If a property is unlivable due to a covered loss, the insurance company will pay for the tenant to live somewhere else like a hotel until the property is repaired or the coverage runs out. Most policies state how much or how long they will pay for alternate housing while the property is being repaired. To summarize the difference, loss of rents is on the landlords policy and pays the landlord for lost rents, loss of use is on the renters policy and provides housing or money to the tenant.
Fire Legal Liability Limit. This is coverage that provides money to the landlord should the tenant be responsible for the claim. If a tenant is smoking in the home and causes a house fire resulting in $25,000 in damage, the landlord can sue the tenant for the damage to the property because it was the tenants fault. The insurance company for the tenant would represent the tenant and pay for the damages to the landlord if it is a covered peril such as fire. In most rental contracts a landlord can charge a tenant for damages to the property and they collect a security deposit to help offset a small amount of damage. So fire legal liability limit coverage is on a tenants policy and pays the landlord if the tenant is responsible for the damage and the damage is a covered peril. The policy probably will not cover intentional damage to the property as an example. Most landlords require tenants to have a renters insurance policy for this exact reason.
Liability Insurance. This works the same way as it does for the landlord but since the tenant is not usually responsible for the general maintenance of the property this would cover negligence of the tenant like a trip hazard such as a rake left in the yard.
We hope you found this information to be useful. This is not an all inclusive list and does not represent what an insurance policy will or will not cover. These are general terms and should only be used as an educational guide. Always consult your agent and read your policy to make sure you have the coverage you need and want.
Landlord Insurance Quote | My …
Saturday, June 12th, 2010 | Uncategorized | 33 Comments
Landlord Insurance Quote | My Landlord Insurance Blog http://bit.ly/cCjcPw
Interesting article presented to us about lead paint.
Thursday, June 10th, 2010 | Landlord Insurance | 10 Comments
New Lead Safe Practices Rule
Effective April 22, 2010, federal law requires that contractors performing renovation, repair and painting projects that disturb more than six square feet of paint in homes, child care facilities, and schools built before 1978 must be certified and trained to follow specific work practices to prevent lead contamination. Lead safe practices include minimizing dust, containing the work area, and conducting a thorough cleanup to reduce the potential exposure associated with disturbing lead-based paint.
The new law is expected to limit the risks of lead poisoning that might result from renovations made to older buildings. Renovation is broadly defined as “any activity that disturbs painted surfaces.” It includes most repair, remodeling, and maintenance activities, including window replacement, weatherization, and demolition. Generally, minor repair and maintenance activities (less than 6 square feet per interior room or 20 square feet per exterior project) are exempt from the work practices requirements. However, this exemption does not apply to jobs involving window replacement or demolition, or that involve the use of any prohibited practices.
The rule covers any individual or firm that is paid to perform work that disturbs known or presumed lead-based paint in housing and child-occupied facilities built before 1978. This includes but is not limited to general contractors; specialty trade contractors including painters, plumbers, carpenters, and electricians; home renovation companies; window replacement contractors; maintenance workers; and to residential rental property owners and managers who perform repairs and renovations themselves.
The rule applies only to renovations performed for compensation. Accordingly, if a homeowner performs renovation, repair or painting work on his own home, the rules do not apply. However lead safe work practices should still be followed to protect home occupants and the value of the property.
There is no question that the new rule applies to renovation activities performed by landlords or employees of landlords. Landlords receive rental payments and maintenance personnel in rental property or child-occupied facilities receive wages or salaries derived from rent payments. The receipt of rent payments or salaries derived from rent payments is considered compensation under the RRP rule. Therefore, renovation and repair activities performed by landlords or employees of landlords are covered by the rule.
Those businesses and individuals affected by the rule are required to:
Apply to EPA to be approved as a Certified Renovation Firm and receive the necessary training and certification from an EPA-accredited training provider for Lead Safe Work Practices.
Assign a Certified Renovator to be present at each project and ensure that lead safe work practices are used throughout the project.
Provide consumers or tenants with the EPA pamphlet “Renovate Right” prior to the start of each project and maintain records documenting that the required information has been provided at each project subject to the rule.
Those seeking to become certified and trained can find more information on the process and a list of accredited trainers at: http://www.epa.gov/lead/pubs/renovation.htm#contractors.
Hundreds of thousands of businesses including contractors, painters, and even neighborhood handymen are affected by the new rules on lead-based paint safety. Failure to comply can be costly, with fines up to $37,500 per violation per day. In addition those who fail to meet the new certification and training standards could potentially be subject to lawsuits from individuals whose health was endangered by the violations.
To date, EPA has certified 204 training providers who have conducted more than 6,900 courses, training an estimated 160,000 people in the construction and remodeling industries to use lead-safe work practices. EPA estimates that more than 200,000 contractors will apply for the new certification.
In addition to the rule becoming effective, the EPA has issued these additional actions:
A notice of proposed rulemaking to require dust-wipe testing after most renovations and provide the results of the testing to the owners and occupants of the building. For some of these renovations, the proposal would require that lead dust levels after the renovation be below the regulatory hazard standards. EPA will take comment on the proposal for 60 days. The agency expects to finalize the rule by July 2011.
An advance notice of proposed rulemaking to announce EPA’s intention to apply lead-safe work practices to renovations on public and commercial buildings. The advance notice also announces EPA’s investigation into lead-based paint hazards that may be created by renovations on the interior of these public and commercial buildings. If EPA determines that lead-based paint hazards are created by interior renovations, EPA will propose regulations to address the hazards.
Additional Information
For more information regarding the new rules visit www.epa.gov/lead or call the National Lead Information Center at 1-800-424-LEAD (1-800-424-5323).
Article presented by rhol.com, Rental Housing On line.
Why is it so hard to insure a …
Saturday, June 5th, 2010 | Uncategorized | 6 Comments
Why is it so hard to insure a vacant house? http://bit.ly/badq40
Market Value Landlord Insuranc…
Saturday, June 5th, 2010 | Tweets | 25 Comments
Market Value Landlord Insurance | My Landlord Insurance Blog http://bit.ly/da9kE2
We need more friends…I mean …
Sunday, April 18th, 2010 | Tweets | 4 Comments
We need more friends…I mean fans. Let people know they must become a fan and if you do we will love you. We love… http://bit.ly/9reKy0
Recent Posts
Categories
Blogroll
Links to Other Blogs and Websites
Useful Website
Recent Comments
- Mikel on The Fundamentals Of Car Rental…
- Paul White on Commercial Real Estate Investing- Overview
- Stainless Steel Cappuccino / Milk Frother on Landlord Insurance Policy Discounts
- Emerilware by T-Fal Emerilware 3-PoundBread & Baguette Maker Review on Understanding Your Home #Insur…
- diablo III news on How many homes are vacant in Detroit?
