One of the most boring topics – to most real estate investors, anyway -- is insurance. That’s why so many get themselves in trouble when it’s too late to do anything about it.
As a real estate investor, you NEED to understand the basics of insurance that directly impacts your business. Property insurance and liability insurance are the backbone of your business’s asset protection plan. Having a major insurance issue – and not having the proper insurance coverage in place – could easily cause your real estate business to go OUT of business, and take all the wealth you’ve built up over time down the drain with it.
Our goal, thru these articles, is to provide a better basis to your real estate insurance knowledge so that you can ask the right questions and make the right decisions when it comes to your insurance.
The first topic, as a basis of understanding, is to discuss “reconstruction value” versus “street value”. Too often people use street value—what the property would sell for today—to try to determine what value they need to use to insure a property.
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