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As a real estate investor in Georgia, managing your property insurance is crucial to keeping your investments profitable. While Georgia hasn't hit Florida levels of "insurance insanity," premiums can still eat into your rental income—sometimes to the point where your annual premium equals one month’s rent. And when that happens, you start to wonder if your insurance company is secretly trying to become your new business partner!
Here's how savvy investors keep costs low, stay covered, and sleep well at night. Spoiler alert: it’s all about finding your comfort zone—and a little bit about giving your insurance company a side-eye.

Under-Insurance and Self-Insurance: Playing the Risk Game

To keep premiums in check, some investors (myself included) under-insure, taking on part of the risk ourselves. It’s like being your own insurance company—except without the fancy offices and the commercials with cute mascots. By lowering coverage and raising deductibles, we can shave off premium costs. It’s a growing trend, especially in Florida, where some investors are going completely “naked” (no, not like that!). They’re skipping property insurance entirely and hoping Mother Nature's in a good mood.
The key here? Keep liability coverage so you’re not left on the hook if something goes wrong—like when a tenant’s dog decides to host its own demolition derby in your rental.

What’s the Worst That Could Happen?

One important question to ask yourself: How likely is it that my property will experience a total loss? Tornadoes, fires—those kinds of things that keep insurance agents up at night. If you're picturing your building reduced to a slab, you might want to invest in enough insurance to sleep soundly. Otherwise, self-insuring some risk can help cut costs. Go with Actual Cash Value (ACV) for a fixed payout, or Replacement Cost Value (RCV) if you want full replacement without the heartburn.
And if you do decide to self-insure, just remember—you’re one tornado away from having a really expensive outdoor patio!

What's Your "Sleep Well at Night" Strategy?

Your risk tolerance is personal—kind of like how spicy you like your wings. Too much risk can leave you sweating (like the wings), but too little risk tolerance can mean you’re overpaying for coverage. The fewer properties you own, the more conservative your insurance strategy should be. But once you hit 50-100 doors, it might make sense to start self-insuring more. At that point, you’ve got enough properties that you can absorb the occasional disaster—sort of like having a few extra shirts when you spill coffee (again) on your favorite one.

Basic vs. Special Form Policies: Don't Skimp!

When it comes to policies, think of Basic Form as the "dollar menu" of insurance. Sure, it’s cheap, but you might regret it later. Always go for Special Form policies—they cover more things, including interior water damage, which Basic doesn’t. And trust me, after a good storm, you don’t want to discover that your policy doesn’t cover the pool that used to be your living room.

Deductibles: How Much Can You Stomach?

Everyone I talk to says set your deductible at least at $5,000, but I’ve gone as high as $10,000. It’s like buying catastrophic coverage only. Think of it this way: if your deductible’s low, your premiums will be higher, and your insurer will be grinning ear-to-ear. If your deductible’s high, your wallet will thank you every month, but if disaster strikes, your bank account might need a pep talk.

Real-Life Losses and Payouts

Over the years, I’ve had my share of “fun” with insurance claims—fires, trees on roofs, the works. All of them were under-insured, but I still got solid payouts within 3-6 weeks. And working with a reliable insurer like nreig.com helps. They’re fast, fair, and don’t mind if you call them up with a question or two (or ten). It’s like they know you’re going to be back for more sooner or later.

Tailoring Insurance to Your Needs

At the end of the day, your insurance strategy depends on your business, your properties, and how much risk you can handle without breaking into a cold sweat. For higher-value homes, I go with RCV, while for my mobile homes, ACV works just fine. I also pick deductibles that won’t make my lender too cranky—though if you push it, they might send a strongly-worded letter. Pro tip: if you ignore the first letter, they usually send a second one. They probably won’t call the loan, so take your time (but maybe don’t push it too far).

Bottom Line: What’s Your Risk Tolerance?

In the end, insurance is a balancing act. You can’t predict every possible disaster, but you can figure out how much risk you can take on without losing sleep. If you want to play it safe, go for full RCV with a low deductible—but be prepared for a hefty premium. If you’re more of a risk-taker, mix in some self-insurance, bump up those deductibles, and see if you can come out ahead.
Just remember, when disaster strikes, you want to be prepared. Because as much as we joke about insurance, it’s not nearly as funny when it’s your roof floating down the street.

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Navigating Property Insurance Strategies for Real Estate Investors in Georgia