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Insurance and Risk Transfer During Volatile Markets

13 minPRO
3/6

Key Takeaways

  • Annual insurance audits should verify replacement cost coverage, $1M+ liability, 12-month rent loss, flood coverage, and ordinance/law coverage.
  • Premium optimization: bundle policies, increase deductibles (with reserves to self-insure), manage claims history, and shop markets every 2 years.
  • Separate LLCs for each property create liability isolation that limits exposure from any single catastrophic event.
  • Insurance and entity structuring together form an integrated risk transfer strategy.
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Test Your Knowledge

1.What percentage of flood insurance claims occur outside designated high-risk flood zones?

2.What is the recommended minimum liability coverage per occurrence for rental property investors?

3.How much have insurance premiums increased in many markets since 2020?