Rehabbing homes, or fixing and flipping homes, is a great way to generate cash, when done right, but the process is scary from an insurance stand point. The fundamentals remain the same. It is important to insure the home, other structures, and landlord property, liability and medical payments. The problem is, as many know, many insurance companies don't want to insure your fix and flip investment because they see a vacant home that can be vandalized, robbed, trashed, or flooded as a high risk. Consequently there can be a few limitations. Vacant homes are typically insured as a DP-1, and the coverage is limited to "named perils". meaning if you have a loss that is not one of these listed items, it's not covered. Endorsements can purchased to increase coverage; below are examples of what is commonly available.
- Fire & Lightning
- Internal / External Explosion
- Windstorm & Hail
- Riot & Civil Commotion
- Volcanic Explosion
Moreover, consider this: If you plan to do a MAJOR renovation to the home you will need a builder's risk policy. Insurance companies are going to want to see that when you leave for the day, that there are windows and doors in place that can be locked. So if you plan on adding space, you might have a problem finding coverage on a traditional policy. This is something to consider in the buying process.
That said, traditional fix and flips are insurable and we can help. Get a quote for your fix and flip investment today, by starting your quote online and letting us shop for you. Or call us at 1-877-784-6787!