Real Estate Investor Insurance: Quotes From $11/mo

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Real estate investor insurance is for trusts, commercial real estate investors, and residential real estate investors. Read how it works, how much to pay for premiums, and where to get comprehensive coverage. 

Errors And Omissions Insurance for Real Estate Investors

Transactions in real estate are very complex. Clients can sue if significant issues arise. Because of this, most real estate investors get errors and omissions insurance. 

You need a $1 million-$5 million errors and omissions insurance. Here are some situations where you’ll find this useful:

• A client decided to sue you after discovering that the contract is highly favorable on your part

• An owner accused you of lowering the valuation of his residential property more than the real value to gain better profits

• A renter accuses you of inflating the cost of a rental property without notice and in violation of the rental contract

• You decided to back out of the deal without telling the seller of the property you promised to buy

• You forgot to disclose to the buyer or renter that the building you’re selling has high levels of asbestos

• A tenant failed to pay his monthly dues. You purposely locked the building or cut off utility services to kick them out 

Errors and omissions insurance covers expenses if you’re liable for or accused of committing negligence, violation of good faith, violation of fair dealing, misrepresentation, and breach of contract. Particularly, you can use this insurance to pay:

• Settlements

• Defense costs

• Court judgments 

General Liability Insurance for Real Estate Investors 

You also need general liability insurance as a real estate investor. Consider getting $2 million-$5 million coverage from this policy. Here are some situations where you’ll find general liability insurance useful:

• You hired a construction company to renovate a building. An accident happened during the renovation and a worker got injured. The construction company demands you pay for the worker’s medical treatment

• A client sustained a broken hip after a slip and fall accident in your office 

• An independent contractor caused an accident while working, resulting in injuries to third parties. The aggrieved parties sued you instead because the independent contractor doesn’t have insurance

• The wiring of your rental property is defective and not fixed. The building burned and damaged the valuables of the renters 

General liability insurance grants a shield when you’re liable for bodily injuries or property damage. It can also provide coverage to the bodily injuries or property damage caused by independent contractors working on your behalf. Use this insurance to pay for:

• Medical treatment of the claimant

• Reimbursement of the claimant’s damaged property

• Defense costs

• Settlements 

Similar to the general liability insurance for real estate agents, the general liability insurance for real estate investors is a broad-form coverage that will also cover:

• Claims for advertising injury, slander, and libel

• Breach of confidentiality

• Auto accidents caused by a hired or borrowed commercial vehicle 

Pollution Liability Insurance for Real Estate Investors 

You also need pollution liability insurance as a real estate investor. This will grant coverage if third parties hold you liable for:

• High asbestos levels of a real property

• Mold outbreak

• Debris and dust as caused by building destruction or collapse

• Chemical runoff that occur while an independent contractor is renovating or constructing a building, house, or other real property you own

• Pollution caused by a vehicle carrying hazardous wastes and materials from your real property 

Consider getting $10 million pollution liability insurance to enjoy comprehensive protection against the perils above. You can use the insurance money from this policy to pay  these expenses:

• On-site and off-site remediation costs

• Debris removal 

• Containment of chemical runoff and environmental restitution

• Compensation for bodily injuries or property damage to third parties

• Mold or asbestos containment and removal

• Emergency mitigation expenses

• Lost revenues 

Directors And Officers Liability Insurance for Real Estate Investors 

Directors and officers liability insurance protects the owner, directors, and officers of a real estate investment company. 

This is essential if your real estate investment company is operating as an LLC, a trust, or a corporation. Here are some situations where D&O insurance is useful:

• A hardworking employee files a claim for discrimination after your real estate investment company’s directors and officers nullified his promotion without any valid reason

• A shareholder decided to sue after the directors and officers of your company sold a property to a sister company at an unreasonably cheap price

• Your company faces a claim for breach of confidentiality after an officer disclosed information for a project that should be under wraps 

• Shareholders and members of your company file a claim after embezzlement happened, which the directors and officers couldn’t trace

• Your real estate investment company bought the property of a director at an unreasonably expensive price. Because of this, a shareholder decided to file a claim and accused the directors and officers of conspiring against the best interest of the company

You need to get at least $5 million D&O insurance for real estate investors. Directors and officers liability insurance applies if vendors, employees, members, shareholders, and other entities file a claim because you, the directors, and other officers committed:

• Social engineering

• Breach of fiduciary duty

• Embezzlement

• Violation of fair dealing 

• Breach of confidentiality

• Misrepresentation

• Negligence 

• Mismanagement and workplace discrimination 

So what costs does directors and officers insurance account for? Your company can use this insurance to:

• Reimburse the losses of the director and officers after compensating or settling for the losses of the claimant

• Reimburse your company if it grants indemnification on behalf of directors and officers

• Cover the defense costs of the officer or director sued by the claimant

• Cover your company’s legal defense expenses if your real estate investment business is also pulled into the lawsuit for the wrongful act of directors and officers  

Rental Property Insurance for Real Estate Investors

While the tenant’s property insurance covers your building, it’s good to get an additional layer of protection.

Rental property insurance covers the residential and commercial property that are currently occupied by tenants. This will reimburse your losses if the following perils cause the damage or destruction of your rental property:

• Fire

• Lightning

• Falling objects

• Smoke

• Explosion

• Wind and hail

• Aircraft

• Vehicle

• Broken plumbing, heating, sprinkler, or appliances

• Civil commotion

• Riot

Real estate investor’s rental property insurance automatically offers a premises liability coverage with a $1 million-$2 million per occurrence and aggregate limit. Premises liability coverage covers the bodily injuries or property damage of tenants and other third parties who experience an accident while on your property.

Renovation Property Insurance for Real Estate Investors

You also need coverage for properties under renovation. For this purpose, get renovation property insurance.

Renovation property insurance for real estate investors reimburses your expenditures if the property and building materials sustains damaged or gets destroyed during renovation due to:

• Explosions

• Equipment breakdown

• Impact

• Theft

• Winds

• Human error

• Fire

• Lightning

A general liability policy is automatically included as part of renovation property insurance. Because of this, you enjoy protection if a passerby, independent contractor, inspectors, and other third parties sustained injuries or property damage while you’re property is being renovated

Builders Risk Insurance for Real Estate Investors

Consider getting builders' risk insurance if you want comprehensive coverage for new buildings under construction and old buildings under renovation.

Builders risk insurance applies if a building you asked a construction company to build from scratch or renovate gets damaged or destroyed due to:

• Fire

• On-site theft

• Equipment breakdown

• Vandalism

• Floods, earthquakes, mudslides, and other natural catastrophes

The coverage of builders' risk insurance also applies to materials and temporary structures such as beams, cement, scaffolding, etc. Read the fine print of your builder's risk policy to know which items are covered.

Builders' risk insurance has exclusions. Remember that it doesn’t grant coverage against these perils:

• War, nuclear hazard, or demolition mandated by the government

• Design errors

• Theft and fraud committed by independent contractors or property custodians

• Normal wear and tear, corrosion, rot, mold, asbestos, etc.

• Pollution liability

Vacant Property Insurance for Real Estate Investors

Also called unoccupied commercial property insurance, vacant property insurance is coverage for buildings you own that have been vacant for an extended period of time.

You purchase this as a named-perils or all-risk policy that reimburses losses when the vacant building gets damaged or destroyed due to:

• Fire

• Theft

• Vandalism

• Riot

• Civil commotion

• Malicious mischief

• Lightning

• Impact

• Vehicle

• Aircraft

• Snow

• Hail

• Rain

Vacant property insurance also covers the computers, furniture, CCTV camera, signage, fire alarm, and other installations outside and inside your building that people aren’t currently leasing or renting.

It’s possible to add a business interruption coverage to vacant property insurance. By doing this, you get reimbursement for lost income while no tenant is paying for their occupancy in your building.

Though the policy covers almost all kinds of buildings you own, coverage doesn’t usually apply on these kinds of real property:

• Unfinished buildings

• Abandoned buildings

• Unoccupied buildings that were used for chemical storage and manufacturing, goods storage and manufacturing, or warehousing

There are some exclusions to real estate investor’s vacant property insurance. It doesn’t grant protection against:

• Molds

• Rats, cockroaches, mice, termites, and other pests

• Floods

Strangers, inspectors, or future tenants can get injured or have their property damaged while exploring your unoccupied building. Because of this, vacant property insurance automatically comes with a $1 million-$2 million general liability insurance.

Workers Compensation Insurance for Real Estate Investors

Consider getting workers' compensation insurance. You’ll need this as soon as you employ one or more real estate agents, accountants, clerks, appraisers, and other professionals.

An employee can experience an occupational injury anytime. Workers' compensation insurance helps you provide benefits without using company funds. Common costs covered by this policy are:

• Private EMT service fees, surgeries, therapies, and other expenses for medical treatment

• Inpatient hospital bills

• Medication

• Rehabilitation and retraining

• Lost wages

• Funeral expenses, allowance to dependents, and other death benefits

You don’t need to cover independent contractors with workers' compensation insurance. Nonetheless, if they require coverage, you can name them as additional insureds.

Employer’s Liability Insurance for Real Estate Investors

Employer’s liability insurance will be offered as part of workers' compensation insurance for real estate investors. Use this to cover settlements, defense costs, and court judgments if an employee sues your company after sustaining a work-related injury or disease.

Employment Practices Liability Insurance for Real Estate Investors

Purchase employment practices liability insurance because employees can also file a claim for employment-related issues. By having this insurance, you can cover defense costs when an employee holds your real estate investment business liable for:

• Sexual harassment

• Discrimination

• Wrongful termination

• Unreasonable rejection of promotion

• Retaliation

• Exploitation

• Other acts that violate employee rights

Commercial Auto Insurance for Real Estate Investors

Get commercial auto insurance to cover unfortunate events that can happen while you’re using a vehicle to meet clients and visit properties. Commercial auto insurance does the following on behalf of your real estate investment business:

• Cover the medical treatment and property damage of people who get involved in an auto accident you caused

• Pay for parts repair or replacement if your car got damaged in a collision or because of fire, theft, lightning, vandalism, weather, and other covered perils

• Reimburse public transportation fees and vehicle rental expenses

• Cover the medical treatment of the driver and passengers

Business Owner’s Policy for Real Estate Investors

A business owner’s policy is a combination of business property insurance and general liability insurance.

Aside from protecting your business against claims for bodily injuries or property damage, a business owner’s policy also reimburses losses if your office and its contents get damaged due to:

• Fire

• Theft

• Vandalism

• Civil commotion

• Riot

• Sprinkler leakage

• Sinkhole collapse

• Volcanic action

• Vehicle

• Aircraft

• Impact

• Winds

• Storm

• Hail

• Snow

Real Estate Investor Insurance Cost

Expect to pay $46 per month or $552 per year for a general liability insurance policy with a $1 million per occurrence limit and a $2 million aggregate limit.

Real estate investor insurance cost is dependent on a wide variety of factors, such as claims history, business history, revenues, number of employees, location, and more. Here’s a table showing the rates of the recommended carriers:

Best Real Estate Investor Insurance Companies

There are many different companies that operate in the real estate insurance industry, and picking out the right one can ensure that you get the best rates available. Read the reviews below to know the best companies’ pros, cons, and pricing for a $1 million general liability coverage.

NEXT Real Estate Investor Insurance

Pros

• Best overall

• Get an online proof of insurance and send as a text message, email, or social media post

• Fastest general liability insurance for real estate investors

• Great customer service and reputation

• Issues an online proof of insurance instantly

• Outstanding value for money

• Bundle two or more insurance policies and get a 10% discount

Cons

• Couldn’t find any

NEXT’s general liability insurance for real estate investors has a $300,000 minimum per occurrence limit. You can upgrade your real estate investor insurance plan to increase general liability policy’s coverage to $1 million. Also, upgrading adds a $1 million professional liability coverage.

Best for: Best overall; Fastest general liability insurance for real estate investors

Average cost: $25 per month

Our rating: 10/10

CoverWallet Real Estate Investor Insurance

Pros

• Compare real estate investor insurance quotes online

• Name additional insureds on your policies for free

• No hidden charges

• Zero deductibles on general liability insurance

Cons

• Not an insurance company but an insurance broker

CoverWallet provides coverage for all kinds of activities involved in real estate. You can get general liability insurance, professional liability insurance, workers compensation insurance, and a business owner’s policy from this company.

CoverWallet’s general liability insurance has a $1 million per occurrence limit with a $2 million aggregate. You can add terrorism coverage and non-owned/hired auto liability coverage to the policy’s terms at an additional cost.

On the other hand, your professional liability insurance from this company will have a $1 million per occurrence and aggregate limit.

Use CoverWallet’s online quotes comparison tool to look at the rates of other insurance companies before getting covered.

Best for: Real estate investor insurance quotes comparison online

Average cost: $28 per month

Our rating: 10/10

Tivly Real Estate Investor Insurance

Pros

• Responsive customer service

• Compare real estate investor insurance quotes over the phone

• Can refer you to partners if it can’t provide coverage

• A partner of reputable insurance companies

Cons

• You need to call to get a quote

Tivly (formerly CommercialInsurance.NET) works with many types of customers. And so, it might provide coverage for real estate investors like you. Call Tivly now to talk with a representative and compare real estate investor insurance quotes over the phone.

Best for: Comparing real estate investor insurance quotes over the phone

Average cost: $33 per month

Our rating: 10/10

Hiscox Real Estate Investor Insurance

Pros

• Customizable limits

• 14-day money-back guarantee

• Worldwide coverage

• Fast to process claims

Cons

• You can’t get commercial property insurance as a stand-alone policy

Hiscox provides general liability insurance, professional liability insurance, and business owner’s policy to real estate investors.

Your professional liability insurance from this company has a $250,000 minimum per occurrence and aggregate limit.

On the other hand, general liability insurance has a $300,000 minimum per occurrence and aggregate limit.

You can customize your general liability and professional liability insurance to enjoy higher coverage.

Best for: Professional liability and general liability insurance with customizable limits for real estate investors

Average cost: $38 per month

Our rating: 10/10