How To Properly Insure Your Investment Property


Make sure when you are insuring your property you are doing so based on the "replacement cost" value and not "market value" (also known as purchase price).

Typically (in most states / housing markets) market value (what you pay for the property) is usually less than what it would cost to rebuild the structure (replacement cost). If you insure your property based on market value and not the true replacement cost (in most situations) you will get penalized by your insurance company for not "insuring it to value" properly.

There are ways to get around this but it's best to insure your property to (the proper) value!

Below is a great image of the differences between market value and replacement cost. 

As you can see, replacement cost takes into consideration things like the cost of materials used, cost of labor and something that isn't calculated in market value (ever) is the cost of clean-up after a claim/loss.

Featured Posts
Posts are coming soon
Stay tuned...
Recent Posts