Insurance Crisis for Real Estate Investors: How to Protect Your Properties in 2026

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Manuel Whitaker (00:00)
Yeah, so over the years we’ve all heard the word climate warming, climate change, some of those things. I don’t use those terms as much as I see real cause and effect. We are seeing more fires in California. No question. Is that due to management? Is it increased heat? Is it what is it based on? I’m not really sure. I don’t want to give the whole answer out there. However, we have to battle it. As an insurance agent, the carriers are definitely scared of it.

Joseph Crooms (02:03)
Hey everyone. Welcome to Investor Fuel Real Estate Pros podcast. I’m your host. Today I’m joined by someone I’ve been looking forward to chatting with. His name is Manuel R. Whitaker. He’s been—he’s in the insurance industry working closely with a lot of real estate people. We’ll bring that out in our conversation today. Manuel, say hello to everybody.

Manuel Whitaker (02:28)
Hey everybody. Happy to be here. Excited to talk today.

Joseph Crooms (02:32)
I think our listeners are going to take something away from how you’re approaching your business. You’re in California and you talked about some very current events. So let’s dive in. So first of all, for people who may not be familiar with your world, give us the short version. What’s your main focus these days and what markets are you operating, especially in real estate?

Manuel Whitaker (02:54)
Right. I would say the markets that we’re operating in, we’re in several western states. We’re mainly western state focused, but basically from I’d say Texas to the West is where we’re focused. Arizona, Oregon, Washington, California. We’re based in California. The bulk of our business is in California. There’s no reason to deviate from that because it’s doing well.

But some of the things we’re—we’re really seeing is a need on the investor side. So many investors been uprooted with non-renewals in our area from their insurance policies, seeing policies that were four or five thousand for a small apartment complex go to eight, nine, twelve thousand in a single year. And they were forced to shop quickly, so they didn’t get to shop last year. So this year we’re finding a lot more people are taking more time and—and calling us a month early versus a day early. Big difference.

Joseph Crooms (03:48)
Caught my attention about the way you—you—you’ve been doing thing is how you looked at the current I guess nature, how it’s affected the insurance and can you elaborate a little bit more on that?

Manuel Whitaker (04:00)
Yeah, so over the years we’ve all heard the word climate warming, climate change, some of those things. I don’t use those terms as much as I see real cause and effect. We are seeing more fires in California. No question. Is that due to management? Is it increased heat? Is it what is it based on? I’m not really sure. I don’t want to give the whole answer out there. However, we have to battle it. As an insurance agent, the carriers are definitely scared of it.

That you saw last year there was a knee-jerk reaction when LA was on fire in January. Almost every marquee carrier that you know stopped writing fire policies. A good percentage of them decided to non-renew their fire policies. That left a huge void. One of the biggest players in the game, State Farm, non-renewed so many home policies and every single one of the commercial policies they had in California for property. That is a huge void, and we’ve been trying to fill it ever since.

Joseph Crooms (05:05)
When you talk about—what is—how has your volume changed in the last three years? What is your volume? What are you—what are you doing on the real estate side, volume wise or revenue wise?

Manuel Whitaker (06:03)
Yeah, I—I would say our—our volume probably doubled in the last twenty-four months and it has to do with this adverse risk and where to go. So when they’re finding themselves without a carrier, the people are shopping. Granted, we advertise for those shoppers. That is what we’re looking for, are those people that are buying a policy in the next seven to thirty days. That’s our target market. We’re trying to help them either close an escrow, find a better coverage for less money. Either—sometimes some of the policies that they bought with short notice didn’t have the eviction coverages and some of the other coverages that they enjoyed with their prior policy and they didn’t know it because they had no time to review the new policy. We’re seeing a lot of people saying, “Hey, I paid double the money and I got half the coverages.” And it’s a real thing.

So we got to really be careful and make sure that we’re going apples for apples when we’re switching these policies over. Not—not our agency, the other agencies need to as well. But make sure that the customer understands what they’re buying. It’s a huge void right now. Lack of education on the customer’s part, lack of understanding that there’s a problem going on right now with insurance in—in most western states.

Joseph Crooms (07:23)
You—you talked about this void that you’re attacking. Back to the revenue. How—how much has—has—have you attacked and how much volume have you picked up on the positive side in the last year? Put some numbers to that.

Manuel Whitaker (07:41)
Yeah, so I would say we were—I’m gonna use this one office here because I didn’t really prepare for the overall picture, so I don’t—necessarily know, but I would say our home applications, our property applications have more than doubled. And in this main—and this is our main office here that I’m at. And a lot of it is we’re getting the referrals not from the customer, but from the agent. And that’s weird. That doesn’t happen in our business, right? We don’t have the—the—the old insurance agent calling the new guy, me, saying, “Hey, do me a favor. Can you help me out with this one? These are really good people. They’ve called and they can’t get a call back. Can you help them?” Okay. So I’m getting a lot of those calls. So what I’ve done is I’ve built relationships with these referring agents. Said, “Hey, I’ll help you out. Only write the business you can’t write, and I’ll protect your other stuff. I don’t need it.” You know, and that way they’re not worried about giving me one piece of their business thinking I’m gonna take the other four policies. It somewhat protects them, insulates them, and allows me to grow. It’s worked out beautifully. So I’d say State Farm agents are one of my best friends right now.

Joseph Crooms (08:56)
And how—now how is that translated into hardcore revenue for you?

Manuel Whitaker (09:00)
Well, it’s just the double of the premiums, right? So the premiums have gone up about thirty percent in the last twenty-four months. So we get an increase on that. So let’s just talk about commissions for a second. We’re gonna get between ten and fifteen percent of all the premiums that are paid. So if the premium goes up thirty percent, well we also got a raise of thirty percent. So the income from that has been good, but the income from doubling the policies has also been good. So in other words, our policy count has doubled. So that of course is good. But the underlying factor that we—we leave off is our age. How long—age in the business? How long and how big is our book of business? So our renewing book of business is in the millions, right? About 18 million. So with that being said, we got a 30% bump on our entire book. So no other time in my whole career, and this is serious, have I ever increased my income by really not doing much more. Did we write a few more policies? Yes, we did. But that wasn’t really the income driver. Their income driver was my book of business that took a 30% increase in revenues over the years, over the twenty-four months. That’s where the real money came. So in—so let’s just say if I write one million in new business a year, hypothetically, and I took a 30% gain, that’s—that’s that amount of money. But times that by 18, 20 million, ooh.

That’s a lot more. So that’s what we got to enjoy this last few years. Will it be that way next year? Don’t know. But one thing it’s always consistent. So we average about a ninety-two percent retention across the board. So out of every hundred policies that we write, about ninety-two of—stick around.

Right now we’re—we’re about a seventy-thirty split. So about seventy percent of our total transactions come in the real estate sector of some sort. Whether it’s condos, duplexes, fourplexes, small apartments, single-family homes, all of—we do all, and there’s no limit to what we did. I—you know, homes built in nineteen hundred, apartment complexes in San Francisco needing earthquake, some that haven’t had updates. It’s amazing what is out there and what isn’t available to insure easily. I would say the easy to insure ones are brand new homes, twenty-five years and newer, and that’s about as easy as it gets. What’s hard is something older than nineteen fifty. Really you get to nineteen hundred, you’re really running out of luck. A hundred years old is your threshold.

Gets real tough. But we can do it. There’s nothing I can’t do. And when you have that kind of confidence, whether you can build—you know, write a home that’s on high lines in the ocean or whether it’s on a cliff overlooking the best view you’ve ever seen, but you got to get there by helicopter, I still can write that house. You know, and that’s the neat thing is when you have the ability of all the carriers that we have, we got—we got something for everybody. And that’s the neat thing, because when the agents out there, and I know I’m long-winded, when the agents out there have one product to sell, that’s—that’s not doing the customer very good. That’s doing the agent very good. He’s got one product, he’s gonna sell it. When you have a—a plethora of products to choose from, and you’re choosing the best one for your client, client wins.

Joseph Crooms (13:00)
And would you say that’s the key to keeping your machine running smoothly?

Manuel Whitaker (13:02)
Grease is my wheel every day, is having the best products available for our clients. Because the client at the end of the day, some do their due diligence and some don’t. But the ones that do, those are the ones that are gonna refer us. They know what they got. They know they got a better deal. They know they—they know they got an agent that calls back on Friday afternoon. They—you know what I mean? They know the service that we do is—are—we’re not new. You know what I mean? We have a—we have a legacy in this area of doing that. And we have to. You know, we can’t do it any other way. We can’t.

Joseph Crooms (13:42)
Now, Manuel, I know every op—every operator I know has a moment when things got real. Maybe a deal that went sideways or a time they had to pivot fast. You mind sharing one of those moments with me?

Manuel Whitaker (13:57)
Yeah. I mean, I—all these years, I got—a few of—as you can tell. You know, I—I will say—one of the worst ones I had was a—a close of escrow, so we all can relate or just keep it in the property sector. And it was a HUD home, a government-owned property, and the windows had been boarded up. The agreement is with most of the insurance carriers that they will not insure a home with boarded-up windows. The rule is at the close of escrow, the boards come down and the house is occupied, blah, blah, blah. In this particular case, it was a close of escrow on Friday afternoon. And the contractor couldn’t get out there to remove the boards on the windows. And it went into the weekend. He was coming out Monday morning. People decided to wait till Monday morning to move in because, you know, they didn’t like it all boarded up. So a fire happened.

And it got declined by the carrier and because the windows were boarded up. They somehow found out windows boarded up. Went into my errors and omissions coverage. Okay, I don’t like it. But that’s what we paid that stuff for. So that was one that I had that was a technicality. Really wasn’t my fault. The supposed boards were supposed to be gone, but they weren’t. Gotta pay. And we did. That was probably twenty years ago.

You know what I mean? I don’t have many stories like that, but that was one that I was just—I was so glad I had the insurance, right? Here’s an insurance guy, glad he had the insurance. That’s one. I would say another one is I’ve had close of escrows where something has fallen apart at the last second. You know, something’s changed. Either, you know, whatever the situation is, it changed. And you can’t make the deadline date, that hurts. You know. That’s some stuff that happens not often, but when it does as a professional, you hurt yourself. You know what I mean? It hurts you. And I would just say the last thing is if you forget, we’re all human and I’m getting older and I forget every once in a while. But like if I think—something’s coming up on the fifteenth, like today, I have a mental thing that I have a—my own clock that I’ve always relied on.

And my clock’s not as great as it used to be. I’m using my phone and other techniques to remember better now. But I did have one policy that I—I missed because I missed the date once. And that—that was a defining moment in my career because I—I changed my systems after that mistake to never make that mistake again. So I had a—a little trip—triple redundancy that I do so I don’t mess up. But yeah, we all have those things. It’s hurtful. It’s—it’s hard to admit it, but we make mistakes.

Joseph Crooms (17:24)
Good for our audience. Let me ask you this. What are you focused on solving or scaling next? What’s your next real goal?

Manuel Whitaker (17:31)
Automation more. You know, as AI is taking over our industry and every other industry, making sure that we’re on top of the tools and that are available to us, not only just to market new business, but to also keep the customers we have happy, utilizing tools to allow them more access to their policies twenty-four hours a day online versus waiting for the insurance office to open to get an EOI or you know, a certificate of some sort. That is something that’s being built right now and is in motion. We’ve been working on doing more account rounding with automation, using the AI to set up and send emails to our clients, cross-selling other products that we offer, pointing out areas of—of coverage voids. So say a landlord that doesn’t have protections for evictions, for example, you’d want to have that coverage. So we—we go through there and try to pick out anything that they might have missed the first time and make sure that it’s on there the go-around. A lot of people don’t—even agents don’t renew policies anymore like they used to. They just let it auto-renew. We still look at—

We’re—you know, we’re a little more labor-intensive around here, but it shows. And that’s what we find our investors are all about that. The people that have one home and they look at their policy once a year, they don’t—they don’t have, how’d you say, an invested interest in their policy like an—a true investor does. He’s looking for all those coverages. He’s looking at liability limits, he’s looking to see whether there’s bedbug protection for his tenants. He’s looking for all these things, especially the short-term. It—investors are just different. They’re different animals. They—they have different expectations, different needs, and they’re more demanding, honestly. They want that cert—they want it today, and not tomorrow. Today. We gotta get it. We gotta deliver.

Joseph Crooms (19:32)
Manuel, that’s big, especially when you—you—you’ve already talked about, you know, looking at the climate, looking at AI, but you—you kept having multi-products. The next move can either compound things or create chaos depending on how you play it.

Manuel Whitaker (19:49)
Sure.

Joseph Crooms (19:50)
Now I know a lot of our people listening are either early in the journey or looking to level up. I think they’re gonna benefit from hearing this. When it comes to building those relationships and growing your network, what’s made the biggest difference for you?

Manuel Whitaker (20:06)
Face-to-face. My face, talking to somebody else’s face. On the phone, don’t work; emails, it’s not the same. Going out there, pressing flesh, like they did in the old days, works the best. It always has been because it’s work. Takes you getting up out of your chair, leaving your environment, going in, you know, going and making an effort, being—having that feeling of awkwardness or, you know, unsure of yourself. Overcome it. Just go in there. Say hello. People are so glad to see you because nobody does it anymore. You know what I mean? I know I do a lot of this stuff from the olden ways. But it worked and it still does. So I love all the trendy stuff too. I have kids and they—they tell me what to do and we’re doing some of those things and they work. I agree. But the one thing is face-to-face. Don’t be afraid to market yourself and your company. My lips are moving, I’m selling. I’m usually selling myself or my company or a product I sell. And that’s what every true salesperson should have in the back of their mind is promoting themselves, promoting their business, and making themselves better for the customers so that they can do more business.

Joseph Crooms (21:23)
Profound. Thank you for sharing that, Manuel. You can’t fake that. Relationships are everything in this space, especially the—you know, how you’re operating and—and how can you tell people unless you meet people. All right, before we wrap up, if someone wanted to reach out, connect with you, maybe collaborate and learn more about what you’re doing, what’s the best way to reach you?

Manuel Whitaker (21:46)
Yeah, you can reach me email, [email protected]. I don’t know if you put it there later, our website is newhorizonins.com. And my phone number, you just call me, 559-259-9852 and I’ll talk to you. It’s 559-259-9852.

Joseph Crooms (22:12)
And your email?

Manuel Whitaker (22:13)
Is Manny, [email protected].

Joseph Crooms (22:22)
Thank you, Manny. Yes, well listen, I appreciate your time, your story, your philosophy. We need more people in this space who are doing the right things the right way. Thanks again for being here. And for those of you tuning in, I know you got some value from this podcast today. Make sure you subscribe.

Manuel Whitaker (22:23)
You bet. Thanks for having me too.

Joseph Crooms (22:48)
We got more conversations coming from operators just like Manny who are out there doing real business and helping real people. So we’ll see you on the next episode of Investor Fuel Real Estate Pros podcast. Manny, tell everybody we’ll see you later.

Manuel Whitaker (23:03)
We’ll see you later.