How Are Real Estate Insurance Premiums Determined?

If you run your own real estate business, you could be making a big mistake if you haven’t signed up for real estate professional liability insurance yet. While you may worry that purchasing insurance could leave you without enough cash flow to successfully run your company, the potential losses that you could face if a client filed a claim against you could have the potential to leave you with nothing. Understanding how premiums are determined can help you figure out what you can expect to pay for insurance. Insurance premiums are based on several different factors, depending on a wide variety of dynamics based on your specific needs. When determining the premiums for real estate professional liability insurance, carriers typically consider the following factors: the size of your company, the type of real estate you sell, the number of claims you have had against you, the risk management programs you have in place and more. By looking at the ins and outs of your business and how things are run within your company, insurance carriers can gauge about how much they would have to pay to cover you. Without insurance, you may find yourself with financial difficulties. No matter the estimate of your premiums, you may benefit from investing in a plan that offers the coverage you need to keep you in business for a long time.