1. It is mandatory in some countries. In NSW, the government now requires agents to maintain professional indemnity insurance of about $1 million.
2. It protects you from any civil liability for claims. For some reasons, business transactions may not go smoothly. Third parties may file lawsuits if they believe that the business have caused them damage or loss. These may involve breach of contract, allegations of misrepresentation, breach of statutory provisions in laws and so on.
3. It is a good investment. When you are confronted with claims, indemnity insurance serves as your financial protection from allegations on misrepresentations or mismanagement.
4. Indemnity insurance gives you the benefit of shielding your personal assets and expenses when you face a court case. It will cover legal costs from investigation to actual defence up to the compensation claimed by the other party. When you’re running a startup, asset protection is very important.
5. In the event that you will be closing your real estate company or retiring from real estate industry, professional indemnity insurance can also protect you. Lawsuit for services you have rendered for years can be taken care of by your insurance. Choose policies with run off coverage. This feature will take care of any claims made after you stopped operating.
6. Having the right professional indemnity insurance will boost your business. It will help you attract more clients. Potential clients are encouraged to obtain your services. Clients are secured that they are transacting business with a reliable and legitimate service.
Improving consumer confidence in the real estate industry is one of the reasons why indemnity insurance becomes mandatory in NSW. Lobbyists had sought to have the policy approved so that customers are confident in entrusting their property transactions. Whatever issues that may arise, real estate agents are prepared to address them.
Protect your real estate business against unforeseen events. With the right type of indemnity insurance, you can live a peaceful life while earning passively. Even after you have retired from work, there is nothing to worry about lawsuits or legal actions as you have your insurance taking care of them.
About the Author: Oliver Finney is a real estate enthusiast and a writer. He frequently writes are articles about real estate which can help home owners, buyers and sellers to find the ideal home solution they need. He shares this resource on professional indemnity insurance for real estate agents.