Be sure to acquire the correct insurance in New London, CT before flipping houses.
Flipping properties can be a revenue opportunity. You buy a house, often through an auction, fix it up, then resell it down the road for profit. While there is definitely money in this business, one bad decision can result in you losing everything. That’s why it’s so important to consider your insurance in New London, CT.
Flipping houses doesn’t sound too difficult, and it appeals to many business-savvy people! What is often missing out, however, are all of the costs, like real estate commissions, closing costs, insurance, taxes, property maintenance, and utilities that come with each transaction. In reality, the actual net profit you get from flipping properties is much less than you might have originally thought.
People often get caught up in the investment part and don’t call their insurer soon enough. Not all insurers want to write insurance policies for house flippers, as this is a gamble in itself. This leads to many new flippers being uninsured or underinsured. It’s safe to say that if you’re taking a risk by flipping a house yourself, you should set yourself up for success by securing financial replacement cost for the house and the building material – before you even start!
In order to do this, you’ll need a dwelling policy, not a standard home insurance policy. Dwelling policies cover only a home’s physical structure, where homeowner’s insurance includes coverage for the contents of your home as well. Dwelling policies can also cover you when renting out to another party.
You should expect a dwelling policy to cost you 25 to 40 percent more than a homeowner’s policy. This can cover the building itself, as well as building materials, such as tile, which would be lying around during the construction process. Under a typical homeowners insurance policy, the tile would not be covered.
Be sure to secure your reliable dwelling insurance in New London, CT! For all of your insurance needs, visit Smith Insurance today!