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Fix and Flip and Landlord Insurance - December 2023


Last updated: December 20, 2023


Landlord insurance and fix and flip insurance for 1 to 4 unit residential properties.


We help real estate investors purchase the right insurance coverage at the most competitive price for rental properties and fix & flip properties.


Landlord Insurance


Insurance for rental properties. Let's make sure you have proper coverage in place to protect your property, your income and your liability. You don't need to compromise on coverage in order to lower your premium -- our landlord insurance program shops carriers that specialize in serving landlords.



Fix and Flip Insurance


Insurance for flips and rentals that are being rehabbed -- also referred to as "Builders Risk Insurance". Complete coverage to protect the value of your property and insure against accidents that can happen on your job site. Our fix & flip insurance program shops the most competitive carriers for this specialized type of insurance so you can rest easy knowing you're protected and not overpaying for coverage.



Builders Risk Insurance


Fix and Flip Insurance is commonly referred to as builders risk insurance. Builders risk is a liability coverage, referred to in Fix and Flip insurance policies as "General Liability" or "Premises Liability". Builders risk protects you, the fix and flip investor (your business entity, usually an LLC, and the members of your entity), from liability if there is an accident that happens at the property. Typically this coverage amount is $1,000,000 per occurrence (per accident) and $2,000,000 in the aggregate (maximum for the annual term of the policy if multiple accidents occur).


Guidelines: Landlord Insurance


Property Insurance


Property Insurance
Mandatory Yes
AM Best Rating A- VIII or greater
Term 1 Year
Limits - If Replacement Cost is greater than Loan Amount, use the greater of 80% of the Replacement Cost or the Loan Amount
- If Replacement Cost is less than Loan Amount, use Replacement Cost
Deductible $5,000
Accepted Policy Types - Dwelling Fire. Must be "Special Form"
- Commercial Property. Must be "Basic" or "Special Form"
Cancellation 30-Day notice
Exclusions - No windstorm / hail exclusion
- No named storm exclusion
Lender's Designation Mortgagee

General Liability Insurance


General Liability Insurance
Mandatory Yes
AM Best Rating A- VIII or greater
Term 1 Year
Limits - $500,000 per occurrence
- $1,000,000 in the aggregate
Deductible $1,000
Coverage Details Occurrence basis for losses (not claims-made)
Cancellation 30-day notice
Lender's Designation Additional Insured

Business Interruption Insurance


Business Interruption Insurance
Mandatory Yes
AM Best Rating A- VIII or greater
Term 1 Year
Limits One year of effective gross rental revenue
Coverage Details Provision for Actual Loss Sustained basis is acceptable
Cancellation 30-day notice
Lender's Designation Mortgagee

Flood Insurance


Flood Insurance
Mandatory If in a flood zone (must obtain Flood Zone Determination)
AM Best Rating A- VIII or greater
Term 1 Year
Limits The greater of $250,000 or the loan balance
Cancellation 30-day notice
Lender's Designation Mortgagee

Additional Details: Landlord Insurance


Mortgagee Clause OfferMarket Capital LLC ISAOA/ATIMA
627 S Hanover St
Baltimore, MD 21230
Condos - Blanket policy may be used if it allows the individual Unit to be included in coverage.
- Homeowner association maintains an “all risk” coverage for common areas, fixtures, personal property, equipment at 100% of their insurable value on a replacement cost basis.
PUDs - Project’s blanket policy may be used if it allows the individual Unit to be included in coverage.
- Homeowner association maintains an “all risk” coverage for common areas, fixtures,
personal property, equipment at 100% of their insurable value on a replacement cost basis.
Instructions - Use ACORD form to ensure compliance
- Send insurance certifications, invoices or paid receipts, no later than 24 hours before closing.
- Send final policy documents, no later than 60 days after closing.
- Borrower must notify carrier if property becomes vacant or unoccupied and obtain a vacancy permit from the insurance carrier for the entire period of vacancy.

Guidelines: Fix and Flip Insurance


Property Insurance


Property Insurance
Mandatory Yes
AM Best Rating A- VIII or greater
Term 1 Year
Limits - Limit is Replacement Cost. Use value from the appraisal report or Replacement Cost Estimator
- Limit is Loan Amount. If loan amount is less than Replacement Cost, you must have an Agreed Value Policy or have zero coinsurance
Deductible $5,000
Accepted Policy Types - Dwelling Fire. Must be "Special Form"
- Commercial Property. Must be "Basic" or "Special Form"
Cancellation 30-day notice
Exclusions - No windstorm / hail exclusion
- No named storm exclusion
Lender's Designation Mortgagee

General Liability Insurance


General Liability Insurance
Mandatory Yes
AM Best Rating A- VIII or greater
Term 1 Year
Limits - $1,000,000 per occurrence
- $2,000,000 in the aggregate
Deductible $1,000
Coverage Details Occurrence basis for losses (not claims-made)
Cancellation 30-day notice
Lender's Designation Additional Insured

Flood Insurance


Flood Insurance
Mandatory If in a flood zone (must obtain Flood Zone Determination)
AM Best Rating A- VIII or greater
Term 1 Year
Limits The greater of $250,000 or the loan balance
Cancellation 30-day notice
Lender's Designation Mortgagee

Additional Details: Fix and Flip Insurance


Mortgagee Clause OfferMarket Capital LLC ISAOA/ATIMA
627 S Hanover St
Baltimore, MD 21230
Condos & PUDs May be covered under borrower’s blanket coverage, so long as the general limit requirements are followed.
Instructions - Use ACORD form to ensure compliance
- Send insurance certifications, invoices or paid receipts, no later than 24 hours before closing.
- Send final policy documents, no later than 60 days after closing.
- Borrower must notify carrier if property becomes vacant or unoccupied and obtain a vacancy permit from the insurance carrier for the entire period of vacancy.

How does OfferMarket Insurance work?


OfferMarket Insurance is a licensed insurance agency specialized in providing real estate investors with insurance for rental properties and fix & flip investment properties.


OfferMarket Insurance shops for the most competitive policy that meets your preferences and our lending guidelines.


Do I need a Builders Risk Policy?


If you are rehabbing or renovating a property or building new ground up construction, you should have a Builder's Risk policy. This is an endorsement in the General Liability Insurance coverage. OfferMarket Insurance policies automatically include Builders Risk coverage when the property is under renovation or construction.


Can I use Functional Replacement Cost instead of Replacement Cost Value?


If the effective age in the appraisal report is less than 15 years, you cannot use Functional Replacement Cost and you must use Replacement Cost Value.


Why does the lender need to be an Additional Insured?


When our clients (borrowers) and their preferred insurance agent try to use a personal lines insurance policy to meet our guidelines, they are surprised to see that -- beyond being the Mortgagee in the Mortgagee Clause -- we require that we are also an Additional Insured. While many insurance professionals think these are the same or equivalent, they are actually different in the following way.


Having the lender as an Additional Insured extends liability to the certificate holder on the same terms provided to the named insured while the mortgagee extends rights in property coverage.


Can I use my preferred insurance agent for my Fix and Flip loan and DSCR loan?


Clients of our private lending platform, OfferMarket Capital, are strongly encouraged to use OfferMarket Insurance to save time and money.


Given that our insurance guidelines are specific and require a commercial policy, we tend to encounter significant delays and operational expense when our client (borrower) insists on using their preferred insurance agent. This is particularly an issue when the insurance agent specializes in personal lines, and is not specialized in commercial lines. For this reason, we charge a $250 insurance review fee which will be included on your HUD-1/ALTA settlement statement.


Can I pay for insurance on the HUD-1/ALTA settlement statement at closing?


If you are a client of OfferMarket Capital for either a DSCR loan or a fix & flip loan, your insurance needs to be paid for in full either on the HUD-1/ALTA settlement statement, or directly through your insurance agent prior to settlement. If you pay directly through your insurance agent, we require a paid receipt for verification.


Can I escrow my insurance premium?


If you are a client of OfferMarket Capital using our DSCR loan you are required to escrow your insurance premium. This means your assigned servicer will collect insurance monthly as part of your PITIA monthly mortgage payment and remit to the insurance carrier on your behalf.


Can I receive a refund if I don't need the full 1 year term?


If you are rehabbing a house, there is a good chance you will not need fix & flip insurance for a full your. As soon as you complete your construction, you can cancel your policy and receive a prorated refund and implement a more cost effective and appropriate property insurance policy while you wait for your property to sell or while you refinance into a DSCR rental loan.


What is an AM Best Rating?


AM Best is a financial services rating agency that specializes in assessing the financial strength and size of insurance companies. Learn more about AM Best Ratings.


What is builders risk insurance?


Builders risk insurance protects your property and on-site construction materials throughout the renovation, construction or rehab phase of your fix and flip or BRRR project. Perils covered by your builders risk insurance policy can vary by insurance carrier and your selected form (basic, special) and most commonly include fire, lightning windstorm, hail, falling debris, vandalism, and theft.


  • Buildings under construction
  • Materials and equipment on premises or within 100 feet
  • Foundation

Your builders risk policy is terminated when one of the following events occur:


  • Property ownership is transferred to the buyer
  • 90 days have elapsed since construction was completed
  • Property is occupied or put to its intended use
  • Insured's interest in the property ceases
  • Insured abandons the construction project with no intention of completion

Most builders risk policies are on a Completed Value Form where the property insurance dwelling coverage policy limit equals the property's ARV or ARV replacement cost estimate.


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