Anyone who owns and operates a business of any kind should understand the very real need to protect that business. Insurance coverage is going to be your best armor when defending yourself and your company from what could amount to as the literal death of your company. So it is with the real estate business, and if you want to see tomorrow and all the tomorrows after that, it’s time to think about all the layers of protection business insurance can offer you.
The Law vs. Adequate Protection
With that being said, have you ever wondered why some real estate agencies simply don’t carry anything other than what they are required to by law in their state? If you are a broker or an agent, it would be a good decision to check out some of the optional coverages above and beyond legal requirements. These optional coverages just might save your brokerage, and your license! The three main types of coverage every real estate brokerage should have include:
- General liability – commercial
- General liability – personal.
- Unemployment insurance
Those are just three types of coverage in relation to the brokerage and broker. Obviously, agents aren’t held responsible to pay unemployment insurance premiums. That falls on the business – the brokerage. At this point, a broker might want to research real estate insurance online. It is possible to compare and contrast various types of commercial real estate insurance so that brokers can choose a tailored plan of coverages for their agency’s needs.
Why Pay for Something That’s Not Needed?
Here is where a huge amount of misunderstanding comes into play. No one ever said you don’t need insurance that isn’t a legal requirement. The only thing the law does is legislate the bare basics for the protection of consumers, the general public. That alone is why governing bodies around the country get involved. It is always to protect consumers. Therefore, just because the government didn’t get involved, doesn’t mean coverage won’t protect you at some future point. It’s finally time to look at those four reasons why every real estate agency needs tailored business insurance.
It’s Time to Consider YOUR Protection!
Basically, as stated above, legislators only get involved when the protection of the general public is involved. They won’t tell you how to protect yourself or your brokerage, but it only stands to reason that it’s something you would want to do for yourself. These are four of those reasons you may want to purchase policies above and beyond those that the government requires you to have. Yes, some of the reasons are partially legal requirements, but there are options in each type of insurance to purchase a policy that has even greater coverage. Think of it like a baseball game in which all bases are covered. That is what adding options above and beyond a legally required business insurance policy is going to do for you.
1. Business Protection for Covered Claims
When it comes to commercial general liability, there is nothing to say what your maximum coverage should be in dollar amounts and no one is going to say how high or low to set your deductible. Although required in most states as a prerequisite for being allowed to do business in that state, you have control of anything over state minimum coverages.
2. Coverage for Damages and Mistakes Resulting from Your Services
This is a coverage you often read about in the news but is usually involving the medical arena. It includes patients with poor outcomes or who claimed to have suffered from the actions, or lack of care, provided by physicians. Big suits are won in court each and every day of the week, so if you want professional liability insurance, try to always get high limits on dollar amounts and reasonable limits on deductibles.
3. Elicits Consumer Confidence
What needs to be said about this reason? If consumers see that you have better than average coverage, you are more likely to close that deal. Insurance does tend to inspire trust.
4. Legal Obligation
Also as mentioned above, you are legally obligated to carry certain types of insurance but there is nothing to say you can’t set amounts much higher than what is required of you by law.
And as a final takeaway, remember that you are only as protected as the strength of your protection. Consider that when purchasing insurance for your brokerage.