Fix & Flip/Vacant Homes


Fix and Flip/Vacant Homes

Utah's property flippers and vacant home investors prefer Anderson Insurance Group for their Utah Vacant Home Coverage for many reasons. The coverage and flexibility is better than other coverage on the market enabling you to put more money back into your investment and to give better protection during the flipping process, here are a few examples:

  • Policy periods of six months with automatic quarterly renewals after the first six months. Premiums are fully earned for each policy period. In other words, you pay six months up front and then can pay quarterly if you have not "flipped" the home after that. If you cancel the policy before the end of the six month or three month periods, you don't get a refund, premiums are "fully earned."
  • Our vacant home coverage covers perils 1-7; Fire & Lightening, Windstorm and Hail, Explosion, Riot or Civil Commotion, Aircraft, Vehicles & Damage caused by Smoke. When peril 8, Vandalism and Malicious Mischief is added, this makes for very comprehensive vacant home coverage. Furthermore, when peril #8 is added, it also adds coverage for theft under the coverage C. here is a copy of the endorsement that explains the coverage added under Peril 8:

116. LIMITED VANDALISM MALICIOUS MISCHIEF AND THEFT ENDORSEMENT

In consideration of additional premium paid, coverage is provided as follows:

PERILS INSURED AGAINST WITH LIMITATIONS, Coverage A and Coverage B, Peril 8 (Vandalism or Malicious Mischief) is added for any structure. Coverage A and Coverage B, Peril 8, limitations a. and b. are deleted.

PERILS INSURED AGAINST WITH LIMITATIONS, Coverage C, Peril 8 (Vandalism or Malicious Mischief) and Peril 9 (theft) are added for any Personal Property (as described and limited under Coverage C) insured under this policy. Coverage C, Peril 8, limitations a. and c. are deleted. Peril 9, limitation c. is deleted.

LIMITS OF LIABILTY

The limit of liability for each "loss" under Peril 8 under this endorsement is the least of:

  1. $10,000;
  2. The limit shown on the Declarations for the insured property; or
  3. The "actual cash value" of the "loss" to the insured property.

This limit applies to all "loss" to Coverage A – Dwelling, Coverage B – Other Scheduled Structures and Coverage C – Personal Property combined.

The limit of liability for each "loss" under peril 9 under this endorsement is the least of:

  1. $5,000;
  2. The limit shown on the Declarations for the insured property; or
  3. The "actual cash value" of the "loss" to the insured property.

The limit of liability for any one "loss" under a combination of Perils 8 and 9 under this endorsement will not exceed $10,000.

For Example, I had an investor who in the process of flipping a home had a thief enter the home and remove all the copper tubing. This type of loss normally not covered under most vacant home policies was covered by his policy.

You will want to refer to your vacant home policy for all the details regarding your coverage but here are a few other things to be aware of:

  • Vacant home policies are AVC or Actual Cash Value policies meaning that any part of the structure or contents can be depreciated based on age and life expectancy of the damaged property.
  • Vacant home policies do not cover theft of tools that are left on the premises so you and your crew will want to make sure that all tools are removed from the premises each time it is left vacant.
  • Vacant home coverage does NOT cover damage from water that has escaped from a water pipe and many other types of damage from water. You will want to take precaution to prevent damage from water including turning off the water each time you or your staff leaves the property unattended.