Posted by Ron (MD) on July 27, 2005 at 13:11:01:
Garry,
I recently said to someone…“I’m not as dumb as I look.”
His witty response was, “It’s a good thing!” 
Hope that works for you.
Ron Guy
Insurance Policy Expiring, Need Two More Weeks - Posted by Garry (Ohio)
Posted by Garry (Ohio) on July 26, 2005 at 11:57:14:
I have a rehab SFR that will be sold approximately 12 1/2 months from when I first purchased it. I currently have a Foremost “vacant home” policy that Foremost will not renew at the 12 month expiration - they consider that the home has been vacant too long and therefore not an acceptable risk. That will leave me with the potential for two weeks without insurance coverage which I clearly wish to avoid. Has anyone out there been faced with this dilema and, if so, how did you go about acquiring the additional short term coverage. This home is owned by my self directed IRA so I simply can’t go and live in it and get a regular “occupied” policy. Also, I can’t imagine getting any of my friends or associates to live in the home for the two weeks since it is out of the way. All suggestions welcome.
Re: Insurance Policy Expiring, Need Two More Weeks - Posted by Ron (MD)
Posted by Ron (MD) on July 27, 2005 at 11:55:55:
Garry,
I’ve been in the same situation.
I asked the buyer to start their insurance on the day mine expires. Since they have a contract on the house, they do have an insureable interest.
At the time, I think their annual policy was about $400, and I offered to pay them $100 for starting their policy a couple weeks early. It worked for both of us.
You’ll need to have you IRA named in their policy as a payee. Then, when you settle, the IRA gets removed from the policy.
Ron Guy
Re: Insurance Policy Expiring, Need Two More Weeks - Posted by JT-IN
Posted by JT-IN on July 27, 2005 at 08:56:10:
Garry:
While it is difficult to know where your timing falls, and whether you are currently at the 12 month point, and now needing 2 more weeks, or are you another month away from needing the 2 weeks additional. If you are NOT in emminent need of coverage, as in “tomorrow”, what I might suggest is that you contact someone who handles Zurich’s “Builder’s Risk Plan”. The will insure vacant properties, in rehab or in new construction… There is NO liability coverage to their coverage, strictly property coverage, so you additionally need a Bus Liability Policy, as well.
The key might be just how close to needing the coverage, since you can’t go out and purchase coverage overnight for this type of risk… The other shot in the dark might be a small agent or agency that may include it in one of their carriers lines, without really asking every possible question. Allow them to ask the questions, without providing them all the reasons “why to say NO”. You may just get coverage “Bound” which would get you beyond the point that you need to be…
A good commercial lines agent should be able to find a spot for you with this problem… even if it is NOT a perfect solution. They are reluctant to jump through the hoops for a single application, so I always recommend using the same person with gravy, that you use for the grief… and it seems to give you more solutions that way…
JT-IN
Totally unrelated to your questions, but… - Posted by Karl (Oh)
Posted by Karl (Oh) on July 26, 2005 at 22:36:12:
Garry,
I was in the home you just sold for cash over in Vista Woods the other day. Your buyer was selling me her A/C unit from her home that burned down. I’m trying to figure out how a cash buyer in my park got past me and found you!
Just wanted to mention that you did a very nice job on the rehab. Your buyer is thrilled with the work. (Or so she told me). Was that the home that had the funky waves in the floor?
No advice for you on the insurance, by the way. Sorry.
Karl Kleiner
The CRE ghost… - Posted by Randy (SD)
Posted by Randy (SD) on July 26, 2005 at 12:19:48:
My post got crossed with one from Jeanne, she graciously deleted both.
I suggested since the buyer will be closing and taking possession two weeks after the expiration of your policy, I would contact the buyer’s insurance agent/company and inquire about a two-week binder to cover the gap. It is unlikely you will be able to get coverage for two weeks otherwise.
Curiosity killed the Cat… - Posted by JT-IN
Posted by JT-IN on July 28, 2005 at 11:42:29:
Since I am always concerned over these type of sticky ins scenarios, I did run this hypotetical past my Ins Underwriter… Here is what he said…
The risk and situation should be explained to the insuring company up front, and both parties should be listed as “Named Insureds”, as opposed to an additional insured or Loss Payee, such as a Lender. Then all potential issues at any such time of a claim are eliminated. He felt that the insuring company would accomodate the circumstance, due to the temporary nature of the circumstance.
For what that one persons opinion is worth, (although highly regarded, IMO).
JT
Potential Conundrum in sight… - Posted by JT-IN
Posted by JT-IN on July 27, 2005 at 22:33:57:
Ron: (and Garry too)…
I’m not trying to throw cold water on your idea, but I do wonder what insurable interest that the buyer has, beyond an earnest money deposit. The RE contract no doubt has language that addresses the situation of a property being damaged, partially or completely, prior to closing. The Buyer likely has the right of cancellation of the contract, in the event of substantial loss to the property…
So playing Devil’s Advocate somewhat, and just doing so because I feel that you may well have some false sense of security from such an insurance policy in being in place prior to closing… Once the insurance company investigate the situation at the time of a partial or total loss, and determines that the Insured, aka Purchaser, has NOT taken title to the property, and their loss is zilch, because all they have to do is request a cancellation of the contract and receive a refund of em deposit, there may be a serious issue with claim payment. Possibly you, as an additional insured may be able to force them to pay such claim, but I would hate to be determining that one in the middle of a claim, especially when the ins co is advising the Purchaser that they aren’t paying… and they need to void the contract…
If you really wanted to know the answer to the question, I would ask the question “point blank” to an underwriter for the insuring company… and my guess is they would say… nah, baby nah… Just my hunch on the subject…
Forgive me for being a bit skiddish on ins claims, and after the fact underwriting of claims… I have seen several people who had weird circumstances of insurability, and in the end the claim was skirted, or settled for way less… I am one who wants no additional hassle at the time of a claim, such as “maybe be aren’t paying”, and I think most folks are the same way… So I only bring it up because it seems like this could be a false sense of security, until you find yourself in that situation… I’d rather know in advance is I am playing with fire… (no pun intended), and if so, then I avoid it, as the risk is just too great, IMO.
Hope my concern is overblown… If you do check it out, I’d like to know the feedback from an underwriter… not an agent… Good luck on it…
JT-IN
Re: Insurance Policy Expiring, Need Two More Weeks - Posted by Garry (Ohio)
Posted by Garry (Ohio) on July 27, 2005 at 12:25:58:
Making it seriously worth their while is a great idea. So simple really. Thanks for the gem.
Garry
Re: Insurance Policy Expiring, Need Two More Weeks - Posted by Garry (OH)
Posted by Garry (OH) on July 27, 2005 at 09:52:17:
The policy expires on August 9th so I’m about two weeks away. The closing is set for August 15th and, if anything, is going to slip further out. I had hoped to bring it back to the 9th.
I’ve called around several local agents and it seems that the minimum policy I can get is a three month paid up for about $500. Ouch! They need 3 business days notice to get the policy written. I will try Zurich as you suggest but if I recall from my earlier search for a policy (when I bought the house) they were more expensive then Foremost. But who knows? It can’t help to ask again.
I need to keep calling around as you suggest.
Garry
Re: Totally unrelated to your questions, but… - Posted by Garry (OH)
Posted by Garry (OH) on July 27, 2005 at 09:32:19:
She had driven through the park and gotten my number right off the sign in the window. She said she liked the tranquil setting under the trees. I think it was a case of the right home at the right time. If I hadn’t had the home I’m sure she would have stayed in Lakeshore and done a deal with you - she knew who you were.
Thanks for the complements on the rehab. Yes, it was the one with the wavy floors. It was a fairly big job but I still made out quite well. BTW Green Tree finally accepted a bid for 1 Oakview at the end of the same street (2BR 1993 Redman) so I will be there next week. Basically a clean up and paint job. Have you heard anything back from Vanderbuilt on 420 Walnut?
Garry
Re: The CRE ghost… - Posted by Garry (OH)
Posted by Garry (OH) on July 27, 2005 at 09:57:38:
I’m a bit reluctant to involve the buyers at this time especially since I have to direct my IRA to enter into whatever arrangement I put together. That’s a real pain in the you know what! However, if I can’t get a reasonable rate on a bridging policy I will have to try that route.
Re: Potential Conundrum in sight… - Posted by Garry (Ohio)
Posted by Garry (Ohio) on July 28, 2005 at 18:55:00:
Good points. Yep, need to tread carefully on this one.
Thanks
Garry
Duplicate post on Ins matter - Posted by JT-IN
Posted by JT-IN on July 28, 2005 at 11:46:26:
Garry:
A copy of what was posted above, in case you didn’t see it… regarding the Purchaser obtaining an Ins policy, to cover the temp void of coverage… and I was concerned with that approach, as you may have read in an earlier post… Conundrum… Read below, input from udnerwriter…
"Since I am always concerned over these type of sticky ins scenarios, I did run this hypotetical past my Ins Underwriter… Here is what he said…
The risk and situation should be explained to the insuring company up front, and both parties should be listed as “Named Insureds”, as opposed to an additional insured or Loss Payee, such as a Lender. Then all potential issues at any such time of a claim are eliminated. He felt that the insuring company would accomodate the circumstance, due to the temporary nature of the circumstance.
For what that one persons opinion is worth, (although highly regarded, IMO)."
JT