A conversation with Darren Nix, founder and CEO of Steadily
Most real estate investors think about insurance exactly twice: when they close on a property and when something breaks. The first time, they shop for the cheapest policy that closes the deal. The second time, they find out what their policy actually covers.
Darren Nix has watched this play out thousands of times. He’s the founder and CEO of Steadily, the landlord insurance platform built specifically for real estate investors, and his company processes claims across every flavor of rental property in the country: long-term, short-term, vacant, mid-renovation, and everything in between.
So I asked him three questions about what landlords get wrong, when they should reshop for insurance, and what’s actually showing up in claims. His answers should be on every investor’s whiteboard.
1. The Cheap Policy That Becomes the Most Expensive Policy You’ve Ever Owned
Q: What’s the most expensive insurance mistake you see new landlords make? The kind of thing that seems fine until there’s a claim and suddenly they’re out tens of thousands?
“Carrying low liability limits like $300K… when somebody gets injured on the property, $300K is barely even enough to cover the attorney fees, let alone a settlement or judgment. Raising liability limits to $500K or $1millon isn’t very expensive, and the extra cost can be offset by a higher deductible. Higher max limits paired with higher deductibles can deliver a lot more coverage for the same price.”
Translation: The cheapest part of your policy to fix is the part most likely to ruin you.
Any of these events triggers a liability claim, and once attorneys are involved, $300K disappears before the case even gets to mediation:
- A guest slips on an icy walkway.
- A contractor’s crew member doesn’t fully fix a safety device.
- A tenant’s kid finds the pool.
The investors who get burned are the ones who had insurance and assumed the limits would hold.
The fix Darren describes is the kind of move that costs almost nothing on paper and pays for itself the one time you need it. Trade some protection against the small claim you can probably absorb for protection against the catastrophic claim you can’t. That trade is almost always worth making.
Your move
Pull out your current policy and find the liability limit. If it’s $300K, get quotes for $500K and $1 million. The math will surprise you.
2. The Re-Shop Window Most Landlords Sleep Through
Q: Landlord policy, STR policy, builder’s risk, vacant home: Coverage needs change as a portfolio evolves. What’s the moment most landlords should reshop their insurance, but don’t?
“My rule of thumb is to reshop every three years, by default. I’ll also reshop if something significant has changed about my property, such as it’s going to be vacant for more than a month, converting to a short-term rental, or undergoing renovations. The reason is I want to make sure I’m going to be covered for the full value of the property in the new situation, for whatever might happen.”
This is the answer most landlords don’t want to hear because it sounds like work. But it’s also what quietly separates investors who get paid out from those who get denied.
Insurance is a snapshot policy. The carrier writes it based on the property’s condition on the day you bought the coverage. The minute the property changes (for example, a long-term tenant moves out, you start a renovation, you list it on Airbnb, or you leave it empty between leases for six weeks), the policy you have is now insuring a different building than the one you actually own.
Some carriers will deny the claim outright. Others will pay out at the lower coverage tier. Either way, you find out at the worst possible moment.
The three-year default is the right cadence even when nothing changes, because the market shifts under you. Premiums move. New carriers enter your market. Your replacement cost goes up. Setting a recurring three-year calendar reminder is the smallest possible action with the biggest possible downside protection.
Your move
If your current policy is more than three years old, reshop it this month. If you’ve made any of the changes Darren listed (vacancy, STR conversion, or renovation), reshop it this week.
3. The 30% Claim Category Nobody Plans For
Q: You’ve seen thousands of claims come through. What’s one type of damage or loss that’s way more common than landlords expect, and one that’s way rarer than the internet would have them believe?
“That’s easy: water damage. Insurance typically covers sudden events like a burst pipe, but not mold removal after months of a seeping toilet ring or a leaking washing machine drain. Water damage is about 30% of most insured losses, and that doesn’t include the ‘uninsured’ losses due to water. The good news is that water damage is easily mitigated by more frequent walkthrough inspections—there are usually signs.
The type of loss that’s exaggerated is theft. It happens, but not as often as people think.”
Three out of every 10 claims is the number that should make every landlord pay attention.
What Darren is referring to is the gap between sudden and gradual water damage. A pipe bursts at 2 a.m.? That’s a covered claim. A slow leak under a sink that’s been seeping for four months, rotted out the subfloor, and grew mold inside the wall? That’s almost never covered, and the remediation bill routinely runs $10,000 to $40,000.
The thing nobody talks about is how easy this is to prevent. Almost every gradual water leak leaves a trail before it becomes a disaster:
- A warped baseboard
- A discolored ceiling tile
- A slightly soft spot in the floor
- A faint musty smell
Property managers who do quarterly walkthroughs catch them. Owners who only see the property once a year don’t.
The flip side is theft. Investors imagine they need elaborate security systems and inventoried personal property coverage because they’ve seen scary headlines. Darren’s data says the actual claim rate doesn’t match the anxiety. Don’t ignore theft, but don’t over-insure against it either.
Your move
Add a quarterly inspection to your property management workflow. Check under every sink, around every toilet base, behind the washing machine, and at every ceiling below an upstairs bathroom. The 15 minutes per property is the cheapest insurance you’ll ever buy.
The One-Line Takeaway From All Three Answers
The cheapest insurance fixes are almost always the highest-impact ones: Raise your liability limit. Reshop every three years. Walk your properties.
None of those require more money, but all three require more attention. That’s the spread Darren’s seen across thousands of claims, and it’s what most landlords leave on the table.
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