Insurance Cost Reduction Strategies
Insurance is a significant operating expense for real estate investors. Strategic choices can reduce costs while maintaining adequate protection.
Deductible Selection
Increasing deductibles from $500 to $2,500 or higher can reduce premiums 10-15%. Only use this strategy if you can afford the higher out-of-pocket cost when claims occur.
Bundling Policies
Insuring multiple properties with the same company often generates discounts. Bundling property and liability coverage provides additional savings.
Loss Prevention Investments
Fire alarm systems, security systems, and sprinkler systems can reduce premiums 10-20%. These investments often pay for themselves through premium savings.
Property Maintenance
Properties in good condition attract lower premiums. Newer roofs, updated electrical systems, and maintained HVAC systems all reduce insurance costs.
Claims History Management
Avoid small claims. Claims follow you for 3-5 years and increase future premiums. File claims strategically, considering the impact on future rates.
Shop Annually
Insurance rates change yearly. Get quotes from multiple insurers annually. You may find significantly better rates with a different company.