When you are considering your own business an independent insurance agency is a great business that provides you with many benefits. Many people never think about becoming an insurance agent because they feel that the procedure might be complicated and expensive. The truth is about anyone can start their own agency with little to know formal training. There are many small insurance providers who will sponsor small agencies. You need to make sure that you are licensed properly through the state you reside, make up a business plan and then contact providers that will permit you to sell their policy.

In most states you are required to take a test in order to get your license as an agent before a license will be issued. You can go to the Secretary of State Office and get training manual that will help you before you take your test. It is very easy to get a license as an agent who sells auto owners and home owners insurance but rather difficult to be licensed to sell life insurance. Many of the companies that you plan on using in your agency will provide you with training materials and a book of business.

The book of business is usually from a previous agent or an agent that lives a distance from where you are and since you are closer the client may want to change. Never assume that because you have inherited a book of business that everyone will become your client. You will need to obtain your own clients or book of business as it is referred too. When you do obtain a license to sell insurance you should also consider getting your organizational license making sure that you are licensed as LLC so that you will not be sued personally. This is vital for many agents because the client may decide to sue you or your business as well as the carrier that is providing them the insurance.

Next you will need a surety bond which basically a guarantor that you will be taking care of business to your customers. The surety bond is very inexpensive and a must for any agency. Then you will need an E & O insurance which protects you from any errors and omission that you might have performed that caused a significant loss to your clients. After you have acquired all the necessary agreements and insurance then you are ready to start your agency with the carrier(s) that have approved you to sell their premiums.

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Article Source: http://EzineArticles.com/?expert=Tom_Tessin

If one of your single-families caught fire last night, are you certain it is insured properly? If a spring storm blew the roof off of your 12-unit apartment building, would you have coverage for your loss-of-rents? Is your subject-to exposure protected? When it comes to insuring your investment properties, it is best to know what protection you have, or don't have, before a claim! It is always nice to save a few dollars to add to your net income, but make sure you are aware, and more importantly, comfortable with your coverage levels and options.

ACV vs. Replacement Cost:

Make sure that you understand the difference between the two options. Also understand what a coinsurance penalty is, and how it may apply to your units. Every property, and property owner, for that matter, is different. Your comfort with how these options affect your coverage is vital for you to make an educated decision on which option to carry per property. ACV may be "cheaper", but could cost you when depreciation is applied to a claim.

Liability Limits:

Always carry as much liability protection as you can afford. As a minimum, you should carry $1,000,000 per occurrence. The larger your portfolio, the more liability protection you should have. Surprisingly, there is a minimal premium charge in most cases to double your protection. An umbrella policy is a method to provide liability coverage beyond the standard $1,000,000 or $2,000,000 limits. An umbrella is usually more cost-effective when you have more than one type of liability exposure.

Other Structures and Personal Property Coverages:

Don't forget to protect against loss of detached structures, such as garages, sheds, and outbuildings. Some policies automatically include limits for these. Also remember to protect items in the units such as refrigerators, stoves, and window air conditioning units. Again, some policies may automatically provide built-in protection for these items.

Ordinance and Law Coverage:

This provides protection for additional costs you may occur in order to bring your damaged property "back to code", as it is repaired from a loss. As time passes and building code changes, most properties are "grand-fathered". However, the repairs that are inspected by the governing municipality are required to be to current code. Hard-wired smoke detectors and handicapped accessibility are two such examples. Without the Ordinance and Law endorsement, such work is typically not covered under your policy. Older properties and multi-unit properties are more at risk for this situation.

Loss-of-rents, or Business Income Coverage:

This provides coverage for your lack of rental income, if your tenants are forced out of your property due to a covered loss. Some policies have built-in coverage to a certain time limit, such as 12 months. Other policies may have an endorsement you must purchase at specific levels of coverage. Either way, this is protection all property owners should have.

Deductibles:

Simply stated, the higher your deductible, the lower your premium. If you are a multi-property owner, and your units are insured under separate policies, your deductible will apply, per location, if you are on what is typically referred to as a "package" or "blanket" policy, your deductible usually applies per occurrence. This could be a big difference, out-of-pocket, in the event of a local catastrophe such as a tornado.

Earthquake, Water Backup and Flood Coverage:

Most policies have exclusions for such losses. You can buy these coverages back through endorsements. Make sure you understand how each coverage may apply, respective of your chosen insurance carrier. This will ensure you can make an educated decision on whether you should have any or all of these coverages.

Insuring the Proper Entity: Make sure you protect YOUR (or your entity's) interests. It is not worth sacrificing the proper protection to avoid the dreaded "due-on-sale" clause. The entity that owns the property should be the first-named insured. The first-named insured is the primary recipient of policy benefits. Additional insured and loss-payee endorsements may suffice in certain situations. However, as a general rule always aim to be the first-named on the insurance contract.

Always work with an Agent you can trust, regardless if they are "captive", or "independent". An Agent that is familiar with our business and willing to take the time and explain your protection needs for your situation, even if they can't offer the policy themselves. We all like to save money, but you purchase insurance for protection. Make sure you understand how it works, before you need it!

Tim Norris
National Real Estate Insurance Group, LLC
2008
888-741-8454
tim@nreinsurance.com

Article Source: http://EzineArticles.com/?expert=Tim_Norris

It is a commonly misunderstood challenge: clarifying the timeless issue of how to properly insure a "subject to" property. The obvious dilemma is the "Due on Sale" (DOS) clause being invoked and the mortgage company calling the note. Though seemingly complex, some common sense rules-of-thumb usually apply. If you (or your entity) own, or have a financial "stake" in the property, be the "first named insured". The first named insured is the primary recipient of any potential claim benefit or liability protection. An "additional insured" will garner liability protection only. A "loss payee" will have its interests protected in the event the property itself is damaged. (A mortgagee is inherently BOTH). If you decide to keep the "homeowner's" policy in place and be named as the additional insured, be advised. If it is discovered that the ex-owner, the first-named insured in this case, no longer owns the property, expect the insurer to deny based upon the fact the policyholder no longer owns the property. Even if you manage the claim to be paid, you are not the entity to receive the proceeds, as you are not the first-named insured. If you did attempt to be added as a loss payee as well, chances are the insurer will question the necessity for you being named as such. When the insurer discovers you now own the property, they will need to write a new policy.

The proper way to insure the property, once you (or your entity) own it, is to have a non-owner occupied "landlord" policy, with you as the new first named insured. The bank/mortgage company is named, as normal, as mortgagee. The prior owner should be named as the additional insured ONLY. Naming the prior owner as additional insured will usually keep the mortgage company happy. But, you may ask, why not keep the ex-owners policy in place? One concern of carrying 2 policies on the same property is that most policies have "excess" clauses. In other words, the policy will pay only excess amounts, if any other policy exists. If each of the 2 policies have such a clause it will create havoc in getting a loss paid...

To further clarify the scenario here is a hypothetical example: Property has a "homeowner" and a "landlord" policy (both) on it. Fire occurs. Owner files a claim under the landlord policy. So far, so good. However, "tenant" (prior owner, or new occupant), has personal property damage. He must also file claim, but against his "homeowners" or tenants policy. The respective insurance company on each claim is bound to find out of the other policy's existence and could (more than likely would) attempt to invoke the "excess" clause of it's own contract, potentially leaving the owner waiting for courts/arbitration to settle... I wouldn't take the chance with 2 policies. If an insurer has an opportunity to mitigate, or deny, a loss if there are contractual issues, be sure they'll try!

(As an added note, if the prior owner moves out, the "homeowners" policy is no longer valid as the property is now "non-owner-occupied"). Bottom line: if you own it, you insure it. If the fact that a DOS clause is/would be invoked if the insurance policy changes, I would walk away before potentially diminishing or even sacrificing coverage by trying to "skirt" the correct way to insure the property. In 12 years, we have yet to have a loan called (knock wood) by insuring the new owner on a "landlord" policy and naming the bank (and the old owner) as mortgagee and additional insured respectively.

Hope this helps your understanding. Feel free to contact me if you have any questions.

Tim Norris
National Real Estate Insurance Group, LLC
2008
888-741-8454
tim@nreinsurance.com

Article Source: http://EzineArticles.com/?expert=Tim_Norris