Old Roof, No Insurance
I'm in the process of buying a property with a roof that's 15 years old.
I've spoken with four insurance companies and they all refuse to insure the property because the roof's too old.
I've never heard of this before.
Has anyone else had this problem and were you able to find any liberal insurers?
If so, who are they?
[addsig]
Haven't had much experience with this myself, but I guess I'm surprised to hear it. It's not like they'd pay much on it anyway, if it were damaged. They'd prorate against the age. Could be that they are more concerned about water damage past the roof line.
Have you checked with high risk insurers? I don't know any off had, but they certainly exist, and will be more busy in the future due to the trend in the industry to get rid of anyone actually *using* their insurance in a claim.
Bryan
I have had the same experience. Most insurers have one or two things they are sticklers on. For example, Allstate insists on the roof being 10 yrs or less even if it is tile or new metal which is supposed to last 50 years or more, but on the otherhand, they could care less about the plumbing,electricity, etc. At least that was how it was last fall. You will also have to see what problems you may run into if you add more properties. You may have one insurer that doesn't care about the roof, but they won't cover more than 4 rentals, or offer commercial policies,etc. Your best bet is probably just to get a good independend agent who doesn't mind doing some research for you. There may be a local insurer that gives you a better deal than a national insurer. They might even have you mix and match with different insurers based on the particular properties which is what I ended up doing.
I've been able to have an exclusion added to the policy, excluding coverage for the roof or any damage caused because of the roof until fixed.
I bought a rehab about 3 years ago and about a months after the closing( in December) the insurance co. decided that they did not like the looks of the roof that was under a foot and a half of snow and sent me a cancelation notice.
I had to insure with Lyods of London to the tune of $1400 (regular policy $430) until the spring when I replaced the roof and the insurance co.
Best of Luck
JohnNH
Rentalman,
What a great and simple idea! I love simple ideas. I can't believe my agent didn't think of or mention simply making an exclusion for the roof or associated problems. Since I used to roof(among other things)while I was in college, I have no reservations about excluding a roof since almost all problems are predictable. For the people who don't have much experience with roofs, to avoid about 95% of water damage problems related to roofs, all you need to do is check your attic ceiling for signs of dampness after a rain. Pay particularly close attention to places where vent stacks or chimneys exit the roof because this is almost exclusively the areas you will see leaks unless the roof is extremely degraded. Also, at the very least I will recoat these areas with a roofing cement every 3 years when I used roofing cement, but now I coat the roofing cement with an acrylic elastomeric and do it every 8-10 years.
Many of the standard carriers won't exclude the roof because of the many related problems it can cause. There are a few carriers that will cover the property with a 15 year-roof. Carry a high deductible ($5000 at least) to offset the difference in premium with the "substandard" insurer. Hope this helps. Tim
Just wanted to thank everyone for their responses.
As always, my fellow CREI members have given me brilliant advice and a variety of avenues I can explore.
I've currently found an insurer who hasn't asked a lot of questions so far (Traveler's Insurance Co.).
Here's hoping everything works out with them and I don't need to continue my search.
But if need be, the roof exclusion sounds like an option.
Also, I have a licensed contractor friend who suggested another far riskier option. He said, to satisy the insurers who want proof I'm replacing the roof (ie. a letter of intent from a contractor), he'd draft me a letter. Then, when they inquired if that roof had been replaced, I'd write him a check, which he'd cash (giving me back the money of course), and I could send the insurers a copy of the cashed check.
Sure, in theory it sounds good. But it also sounds like insurance fraud.
I told him thanks, but only as last resort.
Hopefully it never comes to that.
[addsig]
I know this dosnt answer your question but this is right up that same line.
Last year I was helping my nieghbor totally remodel his house and put a second floor on it. Well before we even got started he recieved a cancellation notice in the mail from his insurance carrier because the house didnt have siding. The problem was he bought the pollicy with the house in the exact same condition as it was in at this time.
Go figure huh? anyways had to find different carrier went with independant agent.
Ed :evil:
Monkfish,
You are right, that would be insurance fraud...to intentionally decieve the insurer to obtain coverage. Felony that wouldn't look good for any future investment endeavors... Remember, too, that even though the insurer may not "ask a lot of questions upfront", most states give the insurers 30-60 days "right of refusal" to cancel coverage after further underwriting. You're better off disclosing everything initially and "doing it right", than wasting your time. Check Foremost Insurance. They may have a product for your scenario. Good luck. Tim
besides insurance companies send out agents to check on the property. so if were to say to them that it has a new roof, it is almost certain that you will get caught.