The Good Stewards Real Estate Podcast

Property Insurance That Wins

Episode Summary

Insurance is a privilege and these agencies can refuse coverage at any point, remember they’re going to be evaluating you as a business as well. Your goal should be to find someone that is invested in the relationship and will go to bat for you when the time comes.

Episode Notes

Insurance Claims:

1:50: Insurance companies are going to ask you a ton of questions and get into the depths of your properties to know the exact risk.

5:27: As long as there’s no loss of life, typically a major insurance claim can be a good thing.

7:03: Ryan thinks that he has bad luck and discusses how he’s had at least 1 major claim a year ranging from arson to floods.

9:05: We want to shout out to State Farm, they've provided us with the best rate and best coverage. But got convinced to switch to Farmers, because of price.

Non-Resident Death Story:

10:00: A friend of a resident climbed up a fire escape, that we had petitioned to be removed, fell and did not survive. We later got our policy canceled from Farmers and State Farm wouldn’t take us back.

Insurance Advice:

13:51: It’s helpful to sit down and talk with your insurance agent, but also be wary that they’ll sometimes fill your head with all the “what if x happens”. So we have a commercial umbrella policy to protect us from liability beyond our property insurance coverage.

16:01: At a certain point, there’s a high likelihood that a quantity discount is in store. Wooster Investments has been a fantastic partner in Kansas City.

18:45: Over the last 30 years, Bill’s seen a number of fires and floods and as long as everyone is safe, there's a real opportunity to go into the property and rehab it with insurance dollars. But when you get the insurance check, make sure to get a second opinion on some retail quotes of what it would cost to rebuild the property.

21:04: If you haven’t filed a claim before, remember that your insurance company really isn’t in the business of cutting a check.

24:10: Make sure that you have coverage for “lost rents”.

27:03: When you do have a loss, you’ll quickly find out if an insurance company is worth it’s weight.

28:17: We have little losses that happen and if we made a claim on every single thing that costs us money that insurance COULD cover, we might get the axe. It’s important to have an internal threshold of are you going to make a claim, what are the values, etc. They are valuing us as a company as well.

31:32: We really recommend finding somebody that you trust and we’ll educate you. Insurance is constantly an education process.

Connect with the Good Stewards:

Episode Transcription

Amanda: We have little losses that happen, and if we made a claim on every single thing that costs us money, the insurance could cover, we might get, we might get the acts from them. And so oftentimes we have to have an internal threshold of, am I going to make a claim on this? How many claims have I made this year? What have been the values of the claim.

[00:00:26] intro: Welcome to the good steward podcast, the only podcast dedicated to seasoned real estate investors who want to maximize the cashflow potential in their business. We are buy and hold investors with a thousand plus properties and markets across the U S, who bring an insider's view into the nitty gritty details of real estate investing. If you're looking to develop the mindset teams and systems that can dramatically build your real estate business and net worth, you're in the right place.

[00:00:58] Ryan: Welcome to this episode of the good stewards podcast. I'm Ryan Dossey.

[00:01:02] Amanda: I'm Amanda Perkins.

[00:01:03] Bill: I'm Bill Syrios.

[00:01:04] Andrew: And I'm Andrew Syrios.

[00:01:06] Amanda: There's lots of things that can go wrong at a property and with staff, but today we're going to get into insurance. Um, things that you need to know, experiences that we've had, and just kind of the ins and outs of something that doesn't seem like the most exciting things sometimes can an operate and a way to make a little bit of money or cost money. Before we dive in, we want to connect with you. Find us on thegoodstewards.com. If you like our content, feel free to share it on social media or just tell people about it. And don't forget to download our free ebook.

[00:01:44] Um, I'm going to start with just kind of talking about different types of insurance and what's worked for us and kind of how we do things. Um, when you're going, first of all, unless you are very wealthy and you can self-insure yourself, which means you probably own all your properties free and clear. Insurance is 100% necessary. So don't forget to close out this step every time you make a property purchase. Um, when you're first making a decision. Um, insurance companies are going to have a lot of questions for either want to know a lot of detail about the property, what kind of wiring is in it, uh, what the construction material is. Um, so it's, you know, it's good to have all that information. What they're trying to figure out, first of all, is their risk on the property. And then also, you know what it's going to cost to replace it if you have a total loss or what kind of, or you know, repairs would cost. And you know, if it has old plumbing, and older wiring, it's going to cost you more to insure because things can happen to those properties rather newer properties, and they might ask you, and it might depend on who your, uh, loan is with, if you want an actual cash value insurance policy or replacement costs. And in our business, um, we. We do both, um, in our Oregon properties. Um, our replacement costs is probably less than our actual cash value.

[00:03:21] Meaning in most cases, we could rebuild the property for less, um, than it would cost us to buy the property new. Just because. The land is in there that, you know, the foundation is there. Just a lot of our appreciation or a market is not necessarily what the materials were used in some of our other markets. Um, we might have a $60,000 house that if it burned down, it would cost us $120,000 to rebuild it. But we only want to get $60,000 worth of insurance on it because we don't want to be paying. Double premiums to be covering ourselves, or maybe you do want to do that. It depends on what you want for your business. Um, our, our insurance decisions are oftentimes based on what our lenders are requiring for us to have. So, um, we, we kind of make those decisions accordingly.

[00:04:17] Ryan: I think that's super interesting. The piece with Oregon, cause I think that's a good differentiator of if the property was, was totally lost. I remember when bill was out in Indianapolis the first time. He's like, man, you couldn't, you couldn't build this for this cheap. And that's, you know, the perks of buying vinyl villages at a discount in the Midwest. Whereas if you're in a market that's maybe a little bit more expensive or maybe a little bit more coastal, you may be into a property for more than it would cost you to build it. But it's also kind of one of those like, good luck finding this property and this piece of land to build this back on.

[00:04:52] Amanda: Right? Yeah.

[00:04:53] Bill: remember you're only insuring the building too. You're not insuring the land, and the building is probably 80% of the value, but that's different in different places. If it's San Francisco or Honolulu, and probably that's not the case, it might be 50 50 but you're just insuring the building. So a insurance agent's going to look at the square footage primarily and say, what would it cost to rebuild this property. And that's the kind of a standard that he or she is going to use when, when they're talking about how much the rate of insurance is going to be on that property.

[00:05:27] Ryan: I think if you have good insurance, I'm going to, I've heard bill say this several times of, as long as there's no loss of life, typically a major insurance claim can be a good thing. Meaning it's something you may come out ahead on. I wanted to clarify amanda's intro said, we're going to talk about  how to make money off of insurance.

[00:05:45] Amanda: Nope.

[00:05:45] Ryan: This, this is not like the mob in New York in the 80's.

[00:05:51] Andrew: I think they're still doing that. The mob, mob hasn't changed their business plan much over time, from my understanding. Um, I think also one, one thing to note is most, just a quick note is most banks will simply require that you have insurance. So the, uh, the, the option of self-insuring is only pretty much if you have no debt, and generally speaking, I, we would all recommend against that.

[00:06:16] Bill: Well, where it gets tricky, and we've fallen into this a hole a couple of times, is when you have a private lender that is loaning you the money on the front end of a purchase, there's nobody there looking over your shoulder, requiring you to have a insurance binder at closing. So you can actually go through closing and forget to put insurance on a property, which we've done a few times. To our chagrin, we have this massive checklist now that that is, you know, in big, bold. A print to remember to put insurance on the property. And we also, uh, when we have a private lender, our lenders become additionally insured. But again, there's nobody looking over your shoulder to do it unless you remember to definitely put insurance on every property that you put under a, that you, they close in escrow.

[00:07:03] Ryan: I dunno if I just have bad luck, but I feel like I have like one major insurance claim a year. Um, in 2016 I had an actual arson at one of our properties. Somebody torched my house and six others on the same street one night. Um, fortunately mine was empty. Um, the following year I had a flood, um, tenant left open water lines on a second story of a house. And, uh, the neighbor when he called us was like, yeah, it's been leaking for like three days. Like me. It would have been great if you would've called a little sooner. Um, and then the last one we had was an electrical fire on a property that resulted in pretty much a total loss. So I think people can think, um. You know, it's not going to happen to me, but I think it's one of those things that like, this isn't an area that you want to try to get creative or cut corners or something.

[00:07:58] Amanda: That kind of leads me to my next thing. You can shop around. Um, but what we've worked, what's any should, and especially when you're getting started, but, um, one thing that we learned and we learned the hard way was insurance is actually a privilege and not a right. So you do not have a right for a company to provide insurance on your property. In fact, they can cancel you. So, um, you know, in our experience in Oregon, we have a company and an agent that, um, you know, we actually have a couple because we have our top tier that we usually get the best rates and they're the, they're the best coverage. We, we love working with them. Um, and then, but sometimes they're picky about the properties they'll insure. So we have another agent that works with, you know, for another company that can find us those. Or sometimes we have to go and get. Really expensive insurance coverage to cover some of our older stuff, because, you know, like our top tier insurance companies decided, you know, it's just outside of their wheelhouse.

[00:09:01] Um, we had an experience, uh, I would say eight years ago now, nine years or seven years ago maybe, and. We had a really, um, we had a relationship with somebody who was new to selling insurance and he talked us into giving up our top tier insurance company that we really liked, which I'll just go ahead and say it was state farm because they provide the best, in our experience, they're the best rate and provide us the best coverage on our properties. And we moved over to another good insurance company. It was Farmers and with an agent and that he kind of talked us into. And, um, I think we saved a little bit of money, but we should have never made the decision on the money piece. And then, we had pretty terrible thing happened at our property that was insured with, um, you know, previously been a state farm, insurance policy, moved to farmers. And that year, uh, we own a lot of campus properties and we actually had, um. Not a resident, but a friend of a resident climb up on the top of a three story building and fall off, and he did not survive and it was terrible. And he was intoxicated when it happened. There were a lot of things about it, but we got our insurance policy canceled and state farm wouldn't take us back. You know, just as a side note, we didn't end up paying out on the policy because we weren't responsible for the loss, but it was still something that happened at our property and can happen, especially in, you know, in a campus environment.

[00:10:40] And so we lost our farmers insurance and we had sort of been grandfathered in with our state farm coverage and just expected that state farm would take us back. But. You know, the, the types of properties, uh, that we were having, you know, like multifamily campus properties that didn't fit in state farm's wheelhouse. And we lost our grandfathered and privileges. And, uh, we ended up, you know, having to go to, I would call it like a third tier insurance company...

[00:11:10] Ryan: Dollar general.

[00:11:12] Amanda: It wasn't dollar general.

[00:11:14] Bill: Alot less insurance for a lot more money.

[00:11:15] Amanda: A lot less insurance for a lot more money is what it was. And it was a, you know, it was kind of one of those experiences. It was like. Oh, Whoa, okay. They don't have to just insure my property because I said, here's my property. Insurance companies are picky. Insurance is about weighing risks, and when they're looking at your property, they're making decisions on if they want your property in their portfolio. So it was something that, um, you know, it was just one of those lessons that we learned along the way.

[00:11:43] Ryan: The, uh, the family who unfortunately had to deal with that. Did they attempt to go after you guys?

[00:11:47] Amanda: Not at all. But what happens with a death claim, um, is that you have a, they have, I think it's normally two years to file a claim in the state of Oregon and...

[00:11:58] Bill: It's actually 3.

[00:11:59] Amanda: If there's loss of life, it's three years. So we had that, uh, as like a potential mark against us when going, you know, we have to report everything when we're going to get insurance. And that co counted against us as a potential loss and potential, you know. The reserve the insurance company was holding out for that was quite large because it could have been a cost. You know, when it costs a lot to defend ourselves. And then all of those things.

[00:12:24] Bill: You learn things along the way that you never knew either. For instance, being in Oregon was helpful in that regard because a claim would have had to, going before a jury would have had to have 51%, uh, that we were, uh, uh,  or somehow responsible to the tune of 1% more than half. If this happened in Washington, if we would have been 23% shown by a jury, 63%. 18% that's where the claim would have been. So, uh, the fact that we were in Oregon made it a lot less likely that we would be sued on it because it was not something that was at all going to get over 50%.

[00:13:07] Andrew: it wasn't even going to get to 1%. And that with that one, the problem was the fire escape went to the roof and we actually requested to have the fire escape removed from the roof and were denied.

[00:13:19] Amanda: Because the fire department has to use that to climb up to put a fire out.

[00:13:23] Andrew: That roof is extremely, I mean, we can, this is a particular issue. It roof has an extreme pitch and there's no way the fire department would use it, but they were few. They rejected our request to remove the part that went to the roof. Um, so there's nothing, you know, nothing we could have done.

[00:13:41] Bill: I think the lesson is, you don't know what you don't know, and you, you should not be, uh, uh, cavalier about. Issues of insurance.

[00:13:51] Amanda: Also it's helpful to sit down and talk to your insurance agent, but also sometimes they will fill your head with all of the, what if this happens and what over what if this happens? And don't you want coverage for that to where you can, you know, you have to...

[00:14:06] Ryan: They're in sales.

[00:14:07] Amanda: You have to make your decision what's best for your company. And you know what that looks like outside of that. Um, you know, we. We have a commercial umbrella policy over the, you know, to protect us from liability beyond our property insurance coverage to things like that to try to protect ourselves in the event that there is a catastrophic insurance loss.

[00:14:28] Ryan: I think my takeaway from it, especially when you've got some seniority somewhere, is like the grass isn't always greener.

[00:14:36] Amanda: That's absolutely what it is. Yeah.

[00:14:38] Ryan: I think, I think primarily if you have seniority, if you're brand new. Yeah. You know, look for good coverage at a good rate. That's, but if you've been somewhere for awhile, um. Make sure you make sure you're prepared to commit.

[00:14:52] Amanda: And so like in our, like for our Oregon portfolio, we, it's a property by property basis decision. But I want an Andrew to touch a little bit on, um, what we've done in some of our other markets that makes it more, um, it is individual to the property, but also sort of a whole as a company and how we put that together.

[00:15:11] Andrew: Yeah. Because sometimes the grass is greener. Um, and what we did in Kansas city, cause we have a lot of properties out here, is no, first of all, we were, we are insuring on an individual basis, one by one, and particularly with affinity or REI guard. And I'm nothing bad to say about them. Uh, they are. A good one. Stop shop very quick. You can get insurance just like that. They don't, they're not very picky. They're, they're very good for investors. They're just in many markets.

[00:15:39] Bill: And by the way, not being picky can really come into handy if you've got a major rehab in front of you, and a lot of top tier insurance companies don't want to insure you if it's a vacant property, if it's got a lot of work to be done, if their electrical is halfway pulled out, uh, the, they're not into that kind of thing. So, uh. Other insurance companies are more open to it.

[00:16:01] Andrew: We also got some with Farm Bureau, which is interesting cause they're state by state. So we found the Missouri one to be pretty good. The Kansas one, we weren't able to make any work. So that's the interesting thing. But eventually, once it got to a certain point, we realized, you know, there's a high likelihood that a quantity discount is in store. And quantity discounts. are a thing with, with uh, insurance, just like they are with thing, with most things. And so we put our entire portfolio up to bid and went to basically eight different insurers or something like that. And the one who ended up winning was an insurer who had been recommended to us from, uh, from one of our, our collegues, our friends who, um, I'll just give him a shout out  Wooster investments who've sent a lot of, uh, new to a lot of apartments in Kansas city. And so we were able to get a very, they had the best quote. It was substantially less than what we were paying. I think we saved about 30% on cost and actually got a bit more insurance.

[00:16:57] The one thing, this kind of leads into a set, so I mean if you have a large portfolio, it is worth getting a bidding them out on a quantity level of trying to get that quantity discount.

[00:17:08] This kind of leads into another discussion a little bit too, because one of the things that you need to be careful with, particularly when you're bidding on a portfolio, but even if you're doing a single one, is that you have them at a, you have them insured for a sufficient enough value to avoid co-insurance. Co-insurance basically is usually, it's from my understanding, is if you're insured for less than 80% of the, uh, of the replacement value  co-insurance kicks in and co-insurance is basically you are insuring the property with them and they'll have, you know, so they'll have you, you have your payout and then they'll split it depending on how, how far down you are. So if you have a property that's, you know, replacement value is $250,000 and you insured it for 50,000 you get a claim for 10,000 you're going to get barely anything cause they're going to split your Coinsuring this property with them. And so you want to be very careful, particularly you're looking to ensure a large number of properties, or at least even a decent number of properties, that all of them are above that line for co-insurance. But that's something you need to taken into account every time.

[00:18:15] And if you are going in a market where it's a little bit less expensive, you can't rebuild a property for the cost. You're going to be using ACV, you know, Actual cash value. You should ask and make sure like this pro, you know, this is, there's no co-insurance on this is there. That's something you just check with your insurance agent. They should be able to tell you. And so that is something definitely be cognizant about.

[00:18:36] Bill: You know, over the last 30 years, I've had a number of fires, a number of floods. Uh, all kinds of manner of grief with properties, including arson and other things. And again, as long as people are safe, I remember actually getting a call. I was in Ohio and back from Eugene, and it was a pretty substantial fire. And the first thing I thought it was everybody okay. And fortunately everybody was. But what that presented was a real opportunity to go into the property and rehab it with insurance dollars. And by the way, when I. When you get insurance dollars, you really want to have some company, um, check into the insurer who's going to come out and figure out how much damage there is. But you might want to have ServPro or another company and even pay him a couple hundred dollars to come out and do an evaluation because you certainly don't want to undercut yourself when you're getting insurance dollars to rebuild a property. So...

[00:19:37]Ryan: Get you some retail quotes.

[00:19:40] Bill: Well yes. So you can do wholesale work, right.

[00:19:43] Ryan: In other words, Angie's list is your friend here.

[00:19:47] Bill: Because you're probably going to be kind of the GC of it or oversee the GC of it. And, uh, you know, there is a profit margin built into everything, right? So get that retail quote and then, uh, use what we've, what we've found is we've usually used every dollar, but we've really done a huge value add to the property. I remember taking a campus property that, uh. Uh, we were able to, it was a duplex. We were willing to make one of them, uh, go from a one bedroom apartment to a three bedroom apartment and a, the house. We also added a couple of bedrooms, two and a in a campus rental market. That's, that's just pure gold because it's like you're adding units to the property when you're adding bedrooms.

[00:20:30] Amanda: Well and not only that, this particular house was one of those that, um, you know, it was older and we'd done an initial rehab, but, um, it was tired and it needed a facelift and we turned it into. Um, I want to say overall, I think we more than doubled our rent potential on the property with the finished product from what we have started with. Um, and I, I know we put some of our own money into it to get what we wanted out of it, but it's turned into a very valuable asset. When it was, it was performing, but now it's a superstar.

[00:21:04] Ryan: I would also touch on just for anybody who hasn't filed an insurance claim like this. Your insurance company really isn't in the business of just cutting a check. Their model really is to pay your claim and then see who they can sue to be made whole. Um, I think that to me was pretty surprising on my first couple of like, wait a minute. Like you're gonna do you want to go after the guy who did this? Um, so just kinda keep that in mind. Um. We had a, a pretty good, uh, pretty decent sub in st Louis who was working on one of our projects and the insurance company was an electrical fire. Um, ended up deeming that they were somehow negligent through their, you know, after fire inspection or whatever. And um, they actually ended up suing the GC to try to go after the GCs insurance to get made whole this, this giant check they had to cut us. And unfortunately, um, you know, that guy could no longer work for us. So just, uh, in case you don't know, that's typically how that works. So if a tenant in one instance with us flooded the property, they went after the tenant for like $64,000. Um, you know what? After a sub on a different one. So that is how insurance, uh, recovers their losses.

[00:22:25] Bill: Yeah. And oftentimes it's unlikely they're going to recover much of their losses, but they're a business.

[00:22:31] Ryan: They're gonna try.

[00:22:32] Bill: They're a business too, and they're basically trying to cover their bottom line when they have a loss.

[00:22:37] Amanda: Well and one caveat, I'm going to interject in here is, um, you know, when you're dealing with this, oftentimes, most of the time that. There have been tenants in our properties during our losses, and they're going to be really unhappy, especially in the case of a fire, a flood that their property was damaged and lost, and your insurance is not going to cover their stuff. Um, and so we do always touch on people. We don't touch on it. We really go into depth about get renter's insurance to cover your belongings because our insurance covers our loss, but not yours. And they. Oftentimes are in one ear and out the other with that. And we don't require them to have that insurance, but it usually, it doesn't end. We, you know, we especially, because I can't usually move back into their places, and so we terminate leases and immediately refund rent costs and security deposits to them, but we don't pay for their stuff and they get a little salty about that. So just you're going to have to deal with it. You better make sure it's in your rental agreement that you're not responsible for their stuff unless you caused the loss. And usually it's not our fault, you know, unless you're just a very negligent landlord, it's oftentimes it's just something happened. Losses happen.

[00:23:56] Ryan: That's the point of renter's insurance. That's what that actually covers. I think a lot of people think it covers, like if they damage the property, um, but it's more to protect their property.

[00:24:06] Bill: Yeah. And I know some property management companies require renter's insurance. Again, we don't, a higher end apartment complexes often require, uh, their residents to carry rental insurance. But, uh, it is, you know, it's an extra step. It's something that not everybody wants or has the money for and you just have to make that judgment call. There is something though called lost rent and most insurance companies will have lost rent, will be part of the cost of covering you in a fire or a flood. And that means that for a certain amount of time, that that property is off market, that that insurance company will pay you what you have been getting in rent, so you won't lose. That ran, and that's a pretty important feature, particularly if you, you have a six month turnover or more in a, in a loss that you're going to get the rental, but make sure you do have lost rents as part of that your insurance package on any particular property.

[00:25:08] Ryan: I do want to highlight Bill's timeline there of six months. Um, typically when something like this happens, a fire, a flood, a major insurance claim, as, as the people who this is affecting, we can get pretty emotional and like, you know, they kind of move fast on this. You know, I'm losing rent, I'm still paying mortgages. I still have taxes and stuff. I have to pay. You need to kind of realize when something like this happens, take a deep breath or two, they're gonna kind of take their sweet time. My experience, you know, um, uh, I don't know how long our, uh, our flood in Indy took, but I think it was like for five months. And then even then like us getting the final like $12,000 check we were owed, took another like two months. So, um, it's kinda like a, what did school teachers say? Like, you know, your lack of planning is not my emergency or whatever, but that's kinda how they handle it. Of like, we're going to do this at our own speed and you can't really complain.

[00:26:12] Amanda: The other thing to consider is. You also have an additional insured if you have a loan on your property. And if you have a big loss, their name's gonna come on the check from the insurance company. And what that means is you have to have them sign off on it in order for you to get the funds. And you know, we recently had one and I reached out to our banker. I was a regional bank. He said, yeah, go ahead and send us the check. We'll hold it and you can let us know when the repairs are done. And I don't know. I mean, that was a, it was a big loss and it was just like, well, wait a minute, we're still paying you. We want that money to do the repairs, you know? So we had to negotiate it, but their policy was, yeah, you can have the insurance money after you do the repairs and prove to us that they're done, and then you hear the money back and that it wasn't a $5,000 loss in that case.

[00:27:03] Bill: This is where you'll find, uh, a insurance company worth its weight kind of thing is at this crunch period when you do have a loss, and I do have to give a shout out to State Farm insurance. There are other great insurance companies. They're not the cheapest, but boy. I have gotten over 30 years, such great customer care from them. And every time I've had a loss, including a lawsuit issues, which by the way, insurance covers as well, particularly if you're drawn into a lawsuit because somebody stepped, you know, stepped on something, uh, that the step gave away or whatever, and they now have a bad ankle, whatever it might be. And I've had more serious than that kind of lawsuits that, that, uh, an insurer stepped in and defended me on to the tune of thousands, tens of thousands of dollars, actually. And state farm is never griped at all about it. Uh, and again, I'm sure there are other really good insurance companies out there. They're not the cheapest, but they. That's when you really learned, you've got somebody on your side is when there's a loss and they're facing a loss, but they're coming alongside you and said, we're going to take care of it. When you're really...

[00:28:14] Ryan: You just used Nationwide's quote to endorse State Farm.

[00:28:17] Amanda: I think that'll kind of lead in, you know, when you're with our, with state farm. We have little losses that happen and if we made a claim on every single thing that costs us money the insurance could cover, we might get the axe from them. And so oftentimes we have to, we have to have an internal threshold of am I going to make a claim on this? How many claims have I made this year? What have been the values of the claim? Because even though we are insured per property, as a company, they're valuing us. And so we don't want to make. Nuisance claims to them for $5,000 and arrest, not having the coverage that we like to have when we want it. So that's, you know, we don't have, we don't have a set a limit ourselves of what we make our claims for, but we always, we talk about it. Some things are really obvious. We're making a claim for this. But you know, sometimes it's like live a small flood after we have some freezing conditions or something and it might cost us $10,000 and we have a $5,000 deductible and we think we're not going to make a claim for this because we're going to go ahead and cover the cost of this because we, you know, we made this claim here. And so we sort of make those decisions for ourselves as the...

[00:29:36] Bill: Claims follow you too. So you can't just jump ship to another insurance company and say, well, yeah, I made a bunch of claims against the last one, but this, they won't know the difference yet.

[00:29:45] Amanda: They will have a loss history report and a new insurance company's always gonna want to see your loss history or pore. It's basically like a year. Uh, your previous tenant record or your credit report for insurance companies. So, um, they don't just go away.

[00:30:03] Andrew: Sometimes there's just not much, much, not much left after your deductible and your deductible is one of the things that you can, you can raise your deductible. And I would generally see insurance has been best for large expenses, um, and having a higher deductible is better. And so. If you have a high deductible, if you have a $5,000 deductible and it's a $6,500 claim, you're getting $1,500 is even worth it. Like this can be true with roofs too. I mean, if you have a low deductible, you might be able to get a, you know, have a hailstorm and get your roof replaced. We have a higher deductible. So basically if there's a house, the deductible is basically the cost of a roof, generally speaking. And so there's no point if it's a commercial building and apartment. Okay. There might be a point. But, um, so taking the account, their deductible when, when. Deciding whether or not to file a claim is, is something to do. And also taking the counter would try to bid down your rate. If your rate, you feel like you're ready to do high, you can't increase your deductible and as long as you have some cash on hand to cover those, those expenses, if they hit you, you will probably save money. And then in the long run,

[00:31:04] Ryan: It's like the poor man's self-insurance.

[00:31:07] Andrew: Yeah. Insurers are in business to make money. So you know, the, the less you do the, you know, the, the, you world generally pay them more than they pay.

[00:31:15] They're in the business of not, you paid them $1,000 for the year for a property and they cut a $50,000 check. Um, you can't go broke making a profit, but you can't go broke paying claims like that.

[00:31:28] Amanda: And the next year you won't have that insurance.

[00:31:32] In closing, we'll go ahead and wrap up. Um, we just want to kind of share a little bit of our experiences and, uh, talk about the necessity of insurance and different types. Um, just I, we really recommend finding somebody that you trust and we'll educate you. Insurance is constantly an education process. So, um. You know, it's good to have somebody on your side, uh, somebody that you trust, not just some slick salesman telling you what you want to hear when, um, you know, he's not going to be there to hold your hand. Uh, when the loss comes in our case. Archer's agent does. So we really appreciate that. Um.

[00:32:11] Ryan: They're with state farm by the way, "State Farm is on your side."

[00:32:17] Amanda: Thank you for tuning into this episode and make sure to look us up, thegoodstewards.com and, uh, make comments, suggestions, reach out to us. We like to hear from you, helps us, um, know what you liked. Uh, give us some good content. Uh, thanks for joining.