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Listen "E12: Changes in the Insurance World That Landlords Should Be Aware Of"
Episode Synopsis
Most property owners only think of insurance as something that protects their assets. But there have been so many changes in the insurance space that property owners should be aware of. You could be sued because someone slipped on your property, and lo and behold, you end up paying out of pocket just because you failed to get your property insured or you didn’t get the right coverage.
In today’s conversation, John Bigham of JAB Insurance Brokers talks about the changes in the insurance space, why landlords should care about insurance, the top three things to look for in a policy, and some tips to reduce your premiums and reduce claims.
Here are some power takeaways from today’s conversation:
Why landlords should care about insurance
What landlords can do to ensure the right coverage
Things to look for in a property inspection
Top three things to look for to ensure a thorough coverage
A landlord dwelling policy vs. a commercial policy
Tips to reduce your premiums and deter claims
Episode Highlights:
[02:25] Why Landlords Should Care About Insurance
One big reason why landlords care about insurance is to protect their property, in the event of, for instance, fire or storm.
The other big piece is when somebody slips, falls, or gets injured on their property and they could sue you for it. Unfortunately, this isn’t something a lot of landlords think about, but if it happens, it could change everything in their portfolio.
You might be renting out a property for so much every month, but that could wipe out three months of your cash flow just to pay for the litigation.
[03:25] Changes Happening in the Insurance Industry That Property Owners Should Be Aware Of
1. Coverage - A lot of carriers are not insuring rental properties anymore. Therefore, you have to make sure you have the right coverage. A slip-and-fall case would most likely cost you half a million dollars and if you don’t have the right coverage in place, that means having to pay that amount out of pocket.
2. Rates - Insurance carriers are raising their rates based on the building because it costs more to replace a house at this moment, especially due to inflation. When looking at the replacement cost or rebuild cost of a building when you purchase it, you may get a good deal on the purchase. But in order to rebuild it, you want to insure it for the full replacement cost of the building, if something happens.
[11:53] The Top Three Things to Look for in an Insurance Policy
1. Replacement Cost - It means they will rebuild your house up to the policy limit, without adding in any depreciation. The other form is the actual cash value, which means they will depreciate the claim based on the age of all the different parts of your house.
2. Loss of Rent or Loss of Income - Is there a loss of income or loss of rent, if there is a claim, I can't rent it out, and I still have to recoup some of my money?
3. Liability - What are the liability limits if somebody gets hurt on my property, and I'm sued? Some people can purchase $100,000, and you want to make sure you have $500,000.
Resources Mentioned:
Website: https://jabins.com
Facebook:www.facebook.com/JABinsurance
Instagram: www.instagram.com/JABinsurance
In today’s conversation, John Bigham of JAB Insurance Brokers talks about the changes in the insurance space, why landlords should care about insurance, the top three things to look for in a policy, and some tips to reduce your premiums and reduce claims.
Here are some power takeaways from today’s conversation:
Why landlords should care about insurance
What landlords can do to ensure the right coverage
Things to look for in a property inspection
Top three things to look for to ensure a thorough coverage
A landlord dwelling policy vs. a commercial policy
Tips to reduce your premiums and deter claims
Episode Highlights:
[02:25] Why Landlords Should Care About Insurance
One big reason why landlords care about insurance is to protect their property, in the event of, for instance, fire or storm.
The other big piece is when somebody slips, falls, or gets injured on their property and they could sue you for it. Unfortunately, this isn’t something a lot of landlords think about, but if it happens, it could change everything in their portfolio.
You might be renting out a property for so much every month, but that could wipe out three months of your cash flow just to pay for the litigation.
[03:25] Changes Happening in the Insurance Industry That Property Owners Should Be Aware Of
1. Coverage - A lot of carriers are not insuring rental properties anymore. Therefore, you have to make sure you have the right coverage. A slip-and-fall case would most likely cost you half a million dollars and if you don’t have the right coverage in place, that means having to pay that amount out of pocket.
2. Rates - Insurance carriers are raising their rates based on the building because it costs more to replace a house at this moment, especially due to inflation. When looking at the replacement cost or rebuild cost of a building when you purchase it, you may get a good deal on the purchase. But in order to rebuild it, you want to insure it for the full replacement cost of the building, if something happens.
[11:53] The Top Three Things to Look for in an Insurance Policy
1. Replacement Cost - It means they will rebuild your house up to the policy limit, without adding in any depreciation. The other form is the actual cash value, which means they will depreciate the claim based on the age of all the different parts of your house.
2. Loss of Rent or Loss of Income - Is there a loss of income or loss of rent, if there is a claim, I can't rent it out, and I still have to recoup some of my money?
3. Liability - What are the liability limits if somebody gets hurt on my property, and I'm sued? Some people can purchase $100,000, and you want to make sure you have $500,000.
Resources Mentioned:
Website: https://jabins.com
Facebook:www.facebook.com/JABinsurance
Instagram: www.instagram.com/JABinsurance
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