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Business Insurance for Insurance Brokers and Brokerage Firms

Insurance for insurance brokers

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As an insurance broker, you work directly with your clients to help them find the best insurance coverage for their needs and budgets. Individuals and businesses depend on you for information about specific policies, what risks they face, and what their coverage options are. Though you are responsible for finding the right insurance policies for your clients, it is a good idea to make sure your own business is appropriately covered as well.

Consider the benefits of having a comprehensive business insurance policy. There are many different types of insurance that are relevant to your business as an insurance broker, most of which you are probably familiar with. An important factor to take into account is that you and your employees work in a professional field, and unlike with a restaurant or clothing store, an error by your colleagues can have serious financial repercussions for your customers.

You may be interested in purchasing insurance for your insurance brokerage if:

What insurance coverage do I need as an insurance broker?

The most common insurance policies for an insurance brokerage often include policies that apply to all businesses, like general liability insurance. However, many other specific coverages may apply, including professional liability insurance and cyber liability insurance. While there are a number of insurance types to consider, we’ve listed below the major insurance coverages you should consider.

Professional Liability Insurance or Errors and Omissions (E&O) Insurance

Your clients depend on you for sound advice and recommendations on the best insurance coverage that can protect their businesses in times of need. If there’s ever any error or mistake in your work that leaves a client without sufficient coverage or in financial trouble, you and your firm could be held liable. Professional liability insurance protects you from lawsuits, whether or not your company is at fault, resulting from your professional work as an insurance broker. Covered areas for professional liability insurance include negligence, misleading statements, performance, and breach of duty.

Examples:

General Liability Insurance

General liability insurance can help protect your insurance brokerage firm from the financial burden of a lawsuit that is unrelated to your professional work. If your insurance brokerage or one of your employees injures a third-party in the course of business, liability insurance can help protect your business against the financial consequences of lawsuits. The four types of coverage that are included in general liability insurance are: products & completed operations, property damage, bodily injury, and personal & advertising injury. General liability also covers the costs of any legal defense or attorney’s fees incurred while defending against covered lawsuits.

Examples:

Commercial Property Insurance

If there is extensive physical damage to property or equipment that you lease or own, the expense of replacing it can negatively affect your bottom line. Commercial property insurance protects you from these costs, by paying for you to replace or rebuild damaged items or structures. The included damage can happen to a building or item that you rent, lease, own, or have borrowed from someone else. Covered items include, but are not limited to: paintings, furniture, office equipment, and computers.

Examples:

Cyber Liability Insurance

As an insurance broker, you store valuable and sensitive data on your clients. From information about business financials to client contact information, much of this data is likely stored on a computer or a network. That’s why it’s especially important to guard your business against the negative impact of any technological mishaps. Cyber liability insurance can protect you from the financial consequences of hacking, viruses, data breaches, and other cyber perils.

Cyber liability insurance also covers the costs of:

Example:

Business Owner’s Policy

A business owner’s policy, also known as a “BOP,” can cover risks that are common to all business owners. A BOP combines the major property and liability risks that small businesses face into one convenient package. It also helps you save money, with lower premiums than buying the individual coverages separately. This type of policy usually bundles together general liability, property insurance, and business income insurance into a single policy.

Final Word

As an insurance broker, you have a duty to put the interests of your customers first. The intricacies of modern insurance require a trained eye, which is why your clients rely on you to communicate information about their policy specifics and help them find the right coverage for their needs. As an insurance professional, you are well aware of the risks of running a business, and you are cognizant of the fact that life doesn’t always go according to plan. The same problems that can plague your clients’ businesses can also affect you. That’s why it’s wise to invest in a comprehensive business insurance package that protects you against many of the liabilities that you face in your day-to-day business operations.

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