What is House Flipping Insurance?
What is House Flipping Insurance?
House flipping insurance, also known as vacant renovation insurance or house flipper insurance, is a specialized type of insurance designed for individuals or companies that buy homes to renovate and sell quickly for profit. Unlike standard homeowner’s insurance, which typically covers occupied homes, house flipping insurance provides coverage for properties that are unoccupied and undergoing renovations.
Key Features of House Flipping Insurance:
- Vacancy Protection: Standard insurance policies often exclude coverage for vacant properties, which are at higher risk of theft, vandalism, and certain weather-related damages. House flipping insurance fills this gap.
- Builder’s Risk Coverage: This component covers the property during renovations, protecting against damages to the structure and materials from events like fire, wind, and vandalism.
- Liability Coverage: Since renovation sites can pose hazards to contractors or visitors, liability coverage protects against potential lawsuits if someone is injured on the property.
- Flexible Policy Terms: Policies are usually short-term and customizable, aligning with the timeline of a flip, whether a few months or a year, allowing house flippers to adjust as needed.
- Optional Add-Ons: Many insurers offer optional coverage for specific risks, such as sewer backups, mold, or even loss of rental income if the flip takes longer than expected and the property is rented temporarily.
House flipping insurance is generally a good investment for flippers because it mitigates the risks associated with vacant, under-renovation properties.
