What Insurance Do I Need in the Real Estate Industry?

Whether you work as a real estate agent, certified realtor, or building owner leasing out space, you face unique risks in your profession. It’s why, when determining your operating expenses, you cannot ignore the importance of having the proper insurance to protect you and your business from those risks.

One of the most important types of insurance to consider is liability protection, which may help protect you from financial damages for which you’re responsible.

There are many other business insurance products you may need, depending on the extent of your operations. To help ensure that you are fully protected, you may want to consider the following types of insurance:

• Business income
  Provides protection for lost net income; mortgage, rent, and lease payments; loan payments; taxes; and employee payroll. It requires that the damages be caused by a covered loss resulting in physical damage to the property. Additional lease cancellation coverage can protect you if a tenant cancels their lease after you sustain a covered property loss, and lessor’s tenant move expenses can assist with moving a tenant out of, and back into, your building after a covered property loss.

• Businessowners policy (BOP)
  Combines property, liability, and business interruption coverages for small- to medium-sized businesses. Coverage is generally less expensive than if purchased through separate insurance policies. An endorsement may provide additional coverage for building owners who rent or lease space.

• Commercial auto
  You need a vehicle to meet clients at different properties. Commercial auto insurance covers the cost to repair or replace vehicles (less depreciation) in the event of an accident, as well as the cost to rent a replacement auto so that your business can continue operating. It also covers your liability arising from an accident in your business vehicle (which may also be covered under your personal automobile insurance policy).

• General liability
  Insures against the liability exposures of many businesses. Coverage can include product liability, completed operations, premises and operations, and independent contractors. This coverage is best obtained through a BOP, which includes other essential coverages for small businesses.

• Commercial excess and umbrella
  Provides greater financial protection by increasing the liability limits of certain underlying policies and, in some instances, provides coverage for certain risks not covered under your underlying policies.

• Cyber insurance
  Provides protection from a range of cyber risks associated with your business data and the use of computers in your operations.

• Employment practices liability
  Coverage for wrongful termination, discrimination, and other violations of employees’ legal rights.

• Miscellaneous professional liability
  Responds to actual or alleged negligent act, error or omission, misstatement, or misleading statement that may occur by the performance of professional services.

• Workers’ compensation
  Pays for medical care and physical rehabilitation of injured workers and helps to replace a portion of lost wages while they are unable to work. Your insurance company may also provide resources designed to assist real estate professionals in developing safe working habits to help control insurance costs.

Before deciding which policies are best for your business, be sure to contact a licensed business insurance broker or agent, who can provide more detailed information, help solicit quotes from insurers, and answer any questions you have. An independent agent can help business owners understand which products can best meet their needs.