How much does insurance cost for real estate businesses?

Real estate businesses pay an average of $68 per month, or $815 annually, for errors and omissions insurance (E&O). This policy is sometimes referred to as professional liability insurance.

Errors and omissions insurance offers critical coverage for real estate professionals, including legal fees related to accusations of professional negligence. For example, if a real estate agent or Realtor fails to inform a client about black mold or termite damage, this policy would cover the costs of a resulting lawsuit.

Some states require real estate agents and brokers to carry this coverage in order to be able to work and close deals.

This is the average errors & omissions policy for real estate businesses that buy from Insureon:

Premium: $68 per month
Policy limits: $1 million per occurrence; $1 million aggregate
Deductible: $1,000

The cost of errors and omissions insurance for real estate professionals depends on several factors, such as your line of work, claims history and the policy limits you choose.

Among real estate businesses that purchase errors and omissions insurance with Insureon, 34% pay less than $50 per month and 68% pay less than $100 per month.

Real estate professionals who have been sued in the past or own a large company may pay more for this insurance coverage. Providers will also look at the type of professional services you offer when determining your premium.

Errors and omissions insurance costs vary significantly among real estate professionals.

In professions where work mistakes can have serious financial repercussions for a client, such as a title abstractor overlooking a zoning restriction on a property, you may find yourself paying more for this policy compared to lower risk professions, like real estate appraisers.

Below you can find expected E&O insurance costs across different real estate professions:

Policy limits are the maximum amounts your insurance company will pay for covered claims.

The per-occurrence limit is the maximum your insurer will pay for a single incident, while the aggregate limit is the maximum your insurer will pay on any claims during your policy period, typically one year.

Most real estate businesses (72%) choose errors and omissions policies with a $1 million per-occurrence limit and a $1 million aggregate limit. As your small business grows, you may need to expand your policy limits.

Learn more about how your real estate business can save money on an E&O policy.

Real estate firms pay an average of $40 per month, or $481 annually, for general liability insurance.

General liability insurance covers common third-party lawsuits from clients, including those related to client bodily injury, damage to a client's property, and advertising injury.

This is the average general liability policy for real estate professionals who buy from Insureon:

Insurance premium: $40 per month
Policy limits: $2 million per occurrence; $1 million aggregate

In addition to general liability insurance, commercial landlords usually also obtain lessor's risk only insurance. This policy protects landlords against tenant lawsuits over property damage and injury, covering legal fees and providing tenant reimbursements.

It's also common for landlords to carry building insurance, which covers any buildings, structures, and completed additions that they lease to commercial tenants.

The cost of general liability insurance depends on several factors, such as the coverage limits you choose, the size of your business, the amount of foot traffic you have, your location, and any additional insured endorsements you add.

The cost of general liability insurance depends on your risk of a client lawsuit.

Among real estate agencies that purchase general liability insurance with Insureon, 35% pay less than $30 per month and 73% pay less than $60 per month.

Across all real estate professions, learn how to find affordable general liability insurance.

Businesses that interact with many clients and have a higher risk of accidents typically pay more for general liability insurance.

For example, commercial landlords can expect to pay more for general liability insurance than mortgage brokers and other lower risk professionals. The average monthly cost for a commercial landlord is $68, while the monthly average for a mortgage broker is $29.

As you can see, the cost varies significantly across different real estate professions:

Policy limits determine how much your insurer will pay on covered claims.

Most real estate businesses (89%) choose general liability policies with a $1 million per-occurrence limit and a $2 million aggregate limit.

As your small business grows, you may need to increase your policy limits for full coverage.

For real estate companies, workers’ compensation insurance costs an average of $50 per month, or $603 per year.

This type of business insurance coverage helps pay for medical expenses when an employee is injured or gets ill on the job. It also provides disability benefits while they're recovering and unable to work.

To comply with your state’s requirements and avoid penalties, real estate businesses typically must purchase this coverage for their employees. It's also recommended for sole proprietors, as health insurance plans can deny claims for medical bills when an injury or illness is related to your job.

Most policies include employer's liability insurance, which covers the cost of lawsuits related to employee injuries. There's usually no limit to how much a workers' comp policy can pay for employee benefits, though it depends on state laws.

The cost of workers' compensation insurance depends on several factors, including the number of employees you have and the level of risk involved with their jobs.

Get more information on how to find affordable workers' compensation coverage.

Among real estate companies that buy workers’ compensation insurance with Insureon, 49% pay less than $50 per month and 76% pay less than $100 per month.

Workers' comp costs depend on the number of employees you have in your small business. A larger workforce brings a higher risk of worker injuries, which is why bigger businesses tend to pay more for this type of insurance.

On average, real estate businesses and brokerages pay $392 per month, or $4,708 per year, for commercial property insurance.

This policy covers the cost of lost, stolen, or damaged business property, such as laptops and office furnishings, from fires, theft, windstorms and other covered events.

Insureon’s licensed agents typically recommend a business owner’s policy (BOP) over a standalone commercial property policy.

A BOP combines general liability insurance with commercial property insurance to protect against both third-party lawsuits and damage to your own business property. It usually costs less than purchasing each policy separately.

Small, low risk real estate businesses are typically eligible for a BOP. Businesses with higher risks can often save money with a commercial package policy (CPP), which offers liability and property coverage with more coverage options and higher policy limits.

This is the average BOP for real estate businesses that buy from Insureon:

Premium: $202 per month
Policy limits: $2 million per occurrence; $1 million aggregate
Deductible: $1,000

It's important to note that if you rent your business property, a standard commercial property policy or BOP wouldn't provide the protection you need. Instead, you would need business renter's insurance. This coverage protects commercial renters in the event of a fire or storm, or even against lawsuits.

The cost of commercial property insurance mostly depends on the value of your business property and equipment. Learn more on how to get affordable commercial property coverage.

Real estate professionals pay an average of $160 per month, or 1,924 annually, for commercial auto insurance.

Most states require this coverage for vehicles owned by a real estate business. For personal, rented, and leased vehicles used by your business, look to hired and non-owned auto insurance (HNOA) instead.

A commercial auto policy provides financial protection in the event of an accident involving your business vehicle. It can help pay for property damage, medical costs, and legal expenses.

The cost of commercial auto insurance depends on several factors, including the policy limits you choose, coverage options, the value of the vehicles, the driving records of anyone permitted to drive, and additional insured endorsements you select.

Learn more about how to find affordable commercial auto insurance coverage.

Small business owners pay an average of $145 per month, or $1,740 annually, for cyber insurance. You might also see this policy called cyber liability insurance or cybersecurity insurance.

Cyber insurance helps real estate businesses recover financially after a data breach or cyberattack. It can help pay for customer notification costs, fraud monitoring services, and other expenses necessitated by state data breach laws.

The cost of cyber insurance depends on the amount of personal information handled by your real estate business, such as customer credit card numbers, along with the number of employees who can access that information.

Real estate professionals pay an average of $95 per month, or $1,140 annually, for commercial umbrella insurance, which is available in $1 million increments.

This policy boosts the protection of your general liability insurance, commercial auto insurance, and employer's liability insurance. When a claim exceeds the limits of the underlying policy, umbrella insurance kicks in to provide coverage.

Real estate businesses may need this type of insurance to obtain certain client contracts or if a landlord requires liability coverage in excess of $2 million.

For example, a landlord might require you to carry $3 million in general liability coverage before they'll sign a lease. In that case, you could carry $2 million in general liability insurance along with a $1 million umbrella policy to meet this requirement.

The cost of umbrella insurance depends on your risks and how much coverage you buy. You need to buy a certain amount of underlying coverage before you can purchase umbrella insurance.

Real estate businesses pay an average of $21 per month for surety bonds, or $250 annually. A surety bond reimburses your client if you're unable to fulfill the terms of a contract or other agreement.

The cost of a surety bond is a percentage of the total bond amount. It may also be influenced by your type of work and your credit score.