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There was a theft at my friend's rental property. The lockbox was broken and all appliance stolen (Fridge, range, microwave, dishwasher). The damage is about $2500 with $1000 in insurance deductible. Normally a claim would have been a no-brainer. However he has 11 properties so is a bit worried that a claim would raise insurance rates on all of his properties. The properties are all in his name,no LLC yet. What is the general opinion of folks here, to claim or not?

PS: The said properties are in Phoenix AZ and the property was vacant for less than 30 days.

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I don't think that is a valid argument. If your deductible was your minimum claim amount you would never make a claim on... (more)

gruntwork (Dec. 14, 2012 @ 10:54a) |

I get VACANT HOME INSURANCE from FOREMOST. The yearly premium is only a couple hundred bucks more than rental property i... (more)

rufflesinc (Dec. 14, 2012 @ 12:18p) |

Thats actually not bad. Will check it out.

gruntwork (Dec. 14, 2012 @ 1:13p) |

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No way . Just the "vacant property " insurance he will be required to get after this will cost more than $1500

oh wow, wasn't aware of this. Does the property has to be vacant certain number of days for the vacant property requirement to kick-in (currently its been vacant for 10 days)? He is actively looking for renters. The insurance company is ANPAC. I guess he will have to go through the policy to figure out vacancy clause.

Per his ANPAC policy, the subject property is not insured if the property is vacant for more than 30 days. So he is covered for the theft. He would be losing at least $1500 by not filing claim. The current insurance rate averages about $280 per year per property. He is actively looking for renters, and there is a very good possibility that he will be able rent the house before the 30 day window as rental market in Phoenix is pretty hot. So assuming that 'vacant property' is not a issue (though it will still be taken into account for the final decision), will the claim impact rates on other properties?

Hell no. NEVER file a small claim. His rates will definitely go up. If not on all properties, on this one for sure. Tell him to suck it up.

sabhinav said:   Per his ANPAC policy, the subject property is not insured if the property is vacant for more than 30 days. So he is covered for the theft. He would be losing at least $1500 by not filing claim. The current insurance rate averages about $280 per year per property. He is actively looking for renters, and there is a very good possibility that he will be able rent the house before the 30 day window as rental market in Phoenix is pretty hot. So assuming that 'vacant property' is not a issue (though it will still be taken into account for the final decision), will the claim impact rates on other properties?

I don't think you get it . He will get his $1500, then they'll tell him to go find another insurer that insures vacant homes. Those policies cost $1500+

Unless its re rented in 20 days they will not continue to take this increased risk at $280/year

Thanks. I get it now... they will effectively cancel his insurance.

For the used appliances "valued at $2500", if you happen to be in a city that had distressed housing prices and foreclosures, I'm sure you can get a lightly used set off craigslist for under $1000 (which is the amount of your deductible anyway). Plus if he's writing off the appliances then the $1000 or even $2500 isn't really costing him nearly that much.

I had a home that the insurance sent me a cancellation notice on because THEY drove by and saw a for rent sign that had only been there a few days. they rescinded the cancellation once I sent them proof it was unrented less than 30 days, plus they were very impressed at the security system I had in place, saying they wouldn't cause me any problems again even if it was longer than 30 days.

here are a couple other things I do:

I now put a 2gig (alarm.com) alarm panel in home that is vacant. I keep electric on but no other utilites or internet. It has a built in cell transmitter, calls me (and optionally, police) if there is an alarm, and it can auto text me each time the door is opened. Instead of lockboxes I put a digital deadbolt lock with keypad and I can give the cleaning company, any realtor who wants to show it, etc, a different code. verify the door is relocked, re-arm the alarm, and and delete those codes online when their visit is over. The alarm with some stick on wireless sensors costs me ~$300 and a few bucks a month for service. Then, when it becomes rented I give the tenants the option of keeping it for another $20 a month. most of them accept so less work.

I also learned the hard way to buy and install (super easy) a kick proof front door reinforcement. $79 from Amazon/Ace Hardware. search safe homes international 55724 or just 'strikemaster II.' some pretty impressive youtube videos/reviews too. they reimburse you for the damages if anyone is able to kick open the door.

expert5186, thanks for the very useful information. I wanted to figure out something to prevent future theft. The theives broke the lockbox and opened the door with the keys, so the text feature could have been very handy here. Both the deadbolt and alarm are good idea. I'll have to teach him some handyman skills.

As far as the appliances are concerned, all of them were purchased new less than a year ago. He will have to suck up the loss, but its the indescribable feeling of being violated that hurts more. This was totally unexpected.

expert5186 said:   plus they were very impressed at the security system I had in place, saying they wouldn't cause me any problems again even if it was longer than 30 days.

Unless you have that in writing assuming your insurance says it is not valid if the place is empty for more than 30 days I can assure you if you ever make a claim large enough for it to be worth them investigating and finding it was vacant 30+ days they won't pay even though they told you this.

If they were bought with a credit card there might be some built in purchase protection against theft depending on how long ago they were bought and what kind of credit card he used.

expert5186 said:    I'm sure you can the stolen appliances back off craigslist for under $1000

PatrickM213 said:   expert5186 said:    I'm sure you can the stolen appliances back off craigslist for under $1000 Match up the serial numbers and he might be able to land the perpetrators in jail.

jalmeleh said:   If they were bought with a credit card there might be some built in purchase protection against theft depending on how long ago they were bought and what kind of credit card he used.

This idea really got me excited. The purchase was indeed made with a credit card in March of this year. However the theft protection on AMEX is only for 90 days and it would be the secondary coverage, that is claim on home insurance has to be made first.



Unless you have that in writing assuming your insurance says it is not valid if the place is empty for more than 30 days I can assure you if you ever make a claim large enough for it to be worth them investigating and finding it was vacant 30+ days they won't pay even though they told you this.


I have it in writing they would cover it waive the vacancy clause on the structure fire policy), but would not extend coverage to not interior furnishings or fixtures (which are pretty limited or non existent anyway on a fire policy).

I bought these policies as close to catestrophic only as possible. high deductible, now probabilty of a claim unless I'm being paid several years of premiums at once , across all properties. Had to push to get them to insure them at levels I really wanted instead of the over inflated values their system forecast. If all the properties on the block are $50k, which includes $5k land value which can't disappear in fire, sorry but I don't want a $267k actual replacement value policy. Just $50k, the value reclaimed from selling the land would pay demolition/closing costs. Then I can buy the same size house next door.

expert5186 said:   For the used appliances "valued at $2500", if you happen to be in a city that had distressed housing prices and foreclosures, I'm sure you can get a lightly used set off craigslist for under $1000 (which is the amount of your deductible anyway). Plus if he's writing off the appliances then the $1000 or even $2500 isn't really costing him nearly that much.

I had a home that the insurance sent me a cancellation notice on because THEY drove by and saw a for rent sign that had only been there a few days. they rescinded the cancellation once I sent them proof it was unrented less than 30 days, plus they were very impressed at the security system I had in place, saying they wouldn't cause me any problems again even if it was longer than 30 days.

here are a couple other things I do:

I now put a 2gig (alarm.com) alarm panel in home that is vacant. I keep electric on but no other utilites or internet. It has a built in cell transmitter, calls me (and optionally, police) if there is an alarm, and it can auto text me each time the door is opened. Instead of lockboxes I put a digital deadbolt lock with keypad and I can give the cleaning company, any realtor who wants to show it, etc, a different code. verify the door is relocked, re-arm the alarm, and and delete those codes online when their visit is over. The alarm with some stick on wireless sensors costs me ~$300 and a few bucks a month for service. Then, when it becomes rented I give the tenants the option of keeping it for another $20 a month. most of them accept so less work.

I also learned the hard way to buy and install (super easy) a kick proof front door reinforcement. $79 from Amazon/Ace Hardware. search safe homes international 55724 or just 'strikemaster II.' some pretty impressive youtube videos/reviews too. they reimburse you for the damages if anyone is able to kick open the door.


That plus the Castle Doctrine laws here in Arizona... it'd be like a Charles Bronson or Clint Eastwood flick.

I had a rental property that was going to be vacant for 30 days while I fixed it up after purchasing it. My insurance company refused to insure it with a landlord policy. I had to get a 15-day construction policy.

Landlord policies will not cover a vacant property and that won't be a problem until you tell them it's vacant. They will definitely cancel your insurance.

kshell said:   PatrickM213 said:   expert5186 said:    I'm sure you can the stolen appliances back off craigslist for under $1000 Match up the serial numbers and he might be able to land the perpetrators in jail.

This is worth a shot. Keep an eye on Craigslist for them... for a few weeks.

If he wants to rent it for sure, just do something like raise the rent but offer 1st month free. Or, something along those lines so that you're ~even at the end of the year, or even a little under as long as it's less than $1500 in the hole, to compensate.

With all you folks saying if the insurance company finds out it is vacant, they will cancel the policy:

Aren't you concerned that if there is a large claim, like a fire burns down the whole place, the insurance will investigate, discover the vacancy, and deny the claim?

alamo11 said:   Hell no. NEVER file a small claim. His rates will definitely go up. If not on all properties, on this one for sure. Tell him to suck it up.

This is why I think Insurance companies are the biggest scam around. The whole point of paying them premiums is that if something DOES happen you're covered. If they have to increase rates every time something DOES happen then their premiums weren't "high" enough to begin with.

There shouldn't even be any debate about whether to report theft or not, the only debate that should occur is whether or not vacant rental properties are covered under the policy or not.

The reality is insurance companies are laughing all the way to the bank, increasing rates whenever something DOES happen and paying out as rarely as possible while using loopholes they insert into huge piles of "paperwork".

technolich said:   alamo11 said:   Hell no. NEVER file a small claim. His rates will definitely go up. If not on all properties, on this one for sure. Tell him to suck it up.

This is why I think Insurance companies are the biggest scam around. The whole point of paying them premiums is that if something DOES happen you're covered. If they have to increase rates every time something DOES happen then their premiums weren't "high" enough to begin with.

There shouldn't even be any debate about whether to report theft or not, the only debate that should occur is whether or not vacant rental properties are covered under the policy or not.

The reality is insurance companies are laughing all the way to the bank, increasing rates whenever something DOES happen and paying out as rarely as possible while using loopholes they insert into huge piles of "paperwork".


<cough>farmers<cough>

sabhinav said:   As far as the appliances are concerned, all of them were purchased new less than a year ago. He will have to suck up the loss, but its the indescribable feeling of being violated that hurts more. This was totally unexpected.

Are you sure this is your "friend's" property?

And I'd keep a close eye on pawn shops, nearby craigslists (several cities), and eBay. Crooks are stupid when it comes to selling stuff. It should be pretty easy to catch these idiots. Neighbors see anything? What'd cops say?

Al3xK said:    Are you sure this is your "friend's" property?
I've a couple of properties in Phoenix and he manages them as well. The theft occurred at his property, I am highly concerned as it can happen to me.

Al3xK said:    And I'd keep a close eye on pawn shops, nearby craigslists (several cities), and eBay. Crooks are stupid when it comes to selling stuff. It should be pretty easy to catch these idiots. Neighbors see anything? What'd cops say?
Unfortunately, he is on vacation and will be back there later this week. And I live out of state. He called the cops but all they said the property owner or authorized party should be at the property for them to do anything.

Yeah regular scanning of eBay and craigslist is definitely on cards.

I would call a property "unoccupied" vs "vacant" if tenant moved out less than 30 days ago. In insurance terminology, unoccupied is much different than vacant. Retired P&C insurance agent here.

Might be a good idea to at least file a police report for the theft. That way if your friends property does show up on Craigslist it might be easier to get the cops involved. Unless he documented all the purchases and serial numbers and stuff. If he doesn't have that info the cops might shrug it off as it would be "hard" for them to prove that they were the ones your friend bought.

If no proof of ownership can be given, I believe the phrase "possesion is 9/10 of the law" become relevant, though IANAL so IDK

Yes he is going to file the police report (if for nothing else than tax purposes). According to him, he might have the receipt but likely wouldn't have the serial numbers, he is going to check the docs when he back.

If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?

For future reference the boxes for major appliances usually have a peelable sticker with all the serial/model numbers. (the installers are supposed to stick them on the instruction manuals)

Crazytree said:   If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?
To satisfy the lender.

And to get paid if it is occupied and the tenant burns it down, or for defense if the tenant brings a liability claim against you .

Otherwise insurance for small losses on a rental property rarely makes sense. Which is why all my insurance deductible are as high as possible. So I pay the least premiums and save it for catastrophic claims

Crazytree said:   If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?

What do seasonsed landlords do during the vacany period? I think this question applies whether or not a claim is made or not for the theft in this particular case.

Does anyone have experience with SimpliSafesecurity system? This one seems to meet my requirements.
1) Easy to install/uninstall. Once the property is vacant go and stick the sensors, and remove it once occupied
2) Pay as you go monitoring for $15/month, or interactive monitoring (arm/disarm with smartphone) $25/month.
3) Cellular monitoring.. no landline required.
4) Cheap equipment, starts at $250.

i'm with suckisstaples, HIGH DEDUCTIBLES. we learned early on with 3 very small but legitimate claims that insurance companies will cancel for this.

Our policies have low ($500-1000) deductibles, HOWEVER, will not even consider a claim if it's under $10k. The only claim made thus far in 20+years was one, for tenants who decided to have a grow op and caused mold damage. That claim started at $50k, and by the time the contractor was done, they paid out somewhere in the range of $300k. Premiums didn't skyrocket because they knew that we wouldn't just go make a claim for every little thing (for example, something breaks, fix it, or window breaks, or door breaks, replace it without involving insurance).

Now for vacant (unoccupied?) properties, our policies DO have a clause that they are NOT covered if nobody visits the property at least once every seven days. This is for two reasons. One, so newspapers don't pile up and just say "I'm empty" to potential burglars, and therefore avoid a claim. Two, to make sure that there isn't anything running or a fluke water pipe bursting or anything of the sort which may lead to a water damage claim (including carpet, electrical, etc... all the bad things water damage can cause).

Never had a company threaten to cancel, but I definitely say while it's vacant, make sure there's trips made to the house and even keep a log of them if you're worried the insurance company may say something. If it's a rental policy that he has, go over the policy for any fine print that may try avoiding payment. But in this case, for a mere (given the amount of policies he has) $1,500 ($2,500-deductible), I'd say it isn't worth it. It just takes one claim to raise the premium on all the policies, and it may be next year or the year after that they raise it, but it will take 5 years to come down, so he'll pay way more than the $1,500 deductible in the long run.

Thanks. He has decided not make a claim and suck up the cost. I've gifted him the Simplysafe security system. Also I agree it would be best to increase the deductible to the limit that the mortgage would allow.

Crazytree said:   If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?

I think the better question is, why not raise your deductible to match your minimum claim amount??

okashiraaa said:   Crazytree said:   If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?

I think the better question is, why not raise your deductible to match your minimum claim amount??


I don't think that is a valid argument. If your deductible was your minimum claim amount you would never make a claim on your 'minimum claim amount' as you would get $0. The right question how much money you are willing to loose while still being comfortable.

sabhinav said:   Crazytree said:   If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?

What do seasonsed landlords do during the vacany period? I think this question applies whether or not a claim is made or not for the theft in this particular case.
I get VACANT HOME INSURANCE from FOREMOST. The yearly premium is only a couple hundred bucks more than rental property insurance. I buy it when I close on the house, then after I get a renter in, I switch it to renters insurance. The premium is prorated. Very easy to do.

rufflesinc said:   sabhinav said:   Crazytree said:   If you are not going to make any claim unless it is huge... and any huge claim will certainly be denied by the insurer if the property is vacant... what's the point of even having insurance?

What do seasonsed landlords do during the vacany period? I think this question applies whether or not a claim is made or not for the theft in this particular case.
I get VACANT HOME INSURANCE from FOREMOST. The yearly premium is only a couple hundred bucks more than rental property insurance. I buy it when I close on the house, then after I get a renter in, I switch it to renters insurance. The premium is prorated. Very easy to do.


Thats actually not bad. Will check it out.



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