Author Topic: Landlord insurance - affected by previous house claims?  (Read 1427 times)

ShoulderThingThatGoesUp

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Landlord insurance - affected by previous house claims?
« on: January 19, 2015, 02:09:18 PM »
About a year ago, I had a pipe burst in my primary residence during a cold snap and power outage. That turned into a $56k insurance claim. Naturally, my home insurance premiums are not small (on a different house now), and when I look for quotes they're all excited about how much they can save me until I tell them about my claim, at which point their quotes are higher than what I'm paying. I know I have to wait three years to get a better price on insurance.

Do I just need to wait three years to even consider income properties? Or do they use totally different standards for landlord's insurance?

jackiechiles2

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Re: Landlord insurance - affected by previous house claims?
« Reply #1 on: January 19, 2015, 07:12:36 PM »
Just try to get a quote on a house you're "considering" buying as a rental property and find out. Rates will likely be somewhat lower than you're currently paying for your house since you won't be insuring any contents.

Stephaniekb

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Re: Landlord insurance - affected by previous house claims?
« Reply #2 on: January 22, 2015, 02:27:59 PM »
Yes, your insurance will be affected by a prior large claim for 5 years after the date of the claim. We found this out the hard way after having a fire in our rental property that maxed out our policy. Quotes for insurance on new rental properties are nearly double what they would be if we were purchasing the property with a  clean insurance history. YMMV given that your loss was "only" 56K

jackiechiles2

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Re: Landlord insurance - affected by previous house claims?
« Reply #3 on: January 22, 2015, 03:12:04 PM »
You may want to create an LLC and buy the property in the LLC name.  Before doing this, you will need to investigate whether the insurance companies will write you a normal Homeowners Policy if the property is in an LLC or whether it will require you to buy commercial insurance. 

 

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