Specialty Insurance

​As an investor, you must know the differences in insurance policies.  Your properties must be covered with dwelling policies.  Remember, you are in business to make a profit and not to spend on mistakes.

Specialty Insurance
By Pierre Mouchette | Real Property Experts LLC

As a real estate investor, you should know the differences in insurance policies.  Speak with contractors and other professionals to determine who they use and recommend speaking about this essential item.  All insurance brokers do not offer the same products!  Remember, you are in business to make a profit and not to spend the profit on mistakes.
 
Dwelling vs. Homeowners Insurance - generally, real estate investors should be covering their investment properties with dwelling policies and not homeowner’s policies.  The difference between the two is:

• A Homeowner’s Policy covers belongings in the home.  Most investors do not need that much coverage.  Be aware that a standard home insurance policy plus umbrella coverage protection may not be appropriate for your needs.  Most standard home insurance policies contain exclusions for vacant or neglected properties.
  • You may also want coverage for malicious mischief.  This will protect you against the kinds of things the neighborhood kids or area vandals and vagrants might commit while occupying your vacant property.  Most homeowner’s insurance will cover this, but not if the property’s been vacant for more than two months while it is being renovated!  This represents a specialty area of coverage, and you need a separate policy to protect you.
    
    
• A Dwelling Policy covers the building itself.  This does not mean that dwelling insurance is cheaper!  Any policy designed to protect vacant buildings is much more expensive than a standard homeowner’s insurance policy because the property is unoccupied and subject to more risks.  The policy premium may be lowered by installing a functional fire alarm and burglar alarm system, having a working heating system, and other basic risk mitigation measures in place.

 
Liability Insurance - provides protection and liquidity against people who claim to be injured because of something that occurred on your property or a property owned by a corporation or LLC controlled by you.