5 Costly Coverage Gaps in Mortgage and Financial Services

How to protect your business from the risks most people overlook

🏠 1. Incomplete Errors & Omissions (E&O) Coverage

What’s missing: Many policies don’t fully protect against lawsuits stemming from misrepresentation, loan documentation errors, or missed deadlines — especially when multiple entities (lenders, brokers, processors) are involved.

Why it matters: A single client dispute can lead to tens of thousands in legal fees, even if you’ve done everything right.

What to do: Review your E&O exclusions carefully and make sure your policy reflects the specific services you offer. Ask if it includes coverage for independent contractors, cyber incidents, and legal defense fees.

💻 2. No or Limited Cyber Liability Coverage

What’s missing: Standard business insurance often excludes data breaches, phishing scams, or wire fraud — even though these are among the most common threats in real estate and lending.

Why it matters: A compromised email or hacked system can result in stolen client funds or lawsuits over exposed personal data.

What to do: Make sure your policy includes both first-party (your costs) and third-party (client claims) cyber coverage. Ask if it covers funds transfer fraud, which is often excluded.

💼 3. Workers Comp Gaps for 1099 Contractors

What’s missing: If you use 1099 loan officers, processors, or marketing help, you might assume you’re not liable for injuries. But in many states, if they work primarily for you, you could still be on the hook.

Why it matters: A slip, trip, or injury could result in a claim against your business if your contractor isn't properly covered.

What to do: Have an insurance advisor evaluate how your workers comp policy (or lack of one) treats your contractor relationships. Some may need to be covered by you to avoid liability.

🛡️ 4. Outdated General Liability Limits

What’s missing: Many firms set their coverage years ago when they were smaller. If your revenue has grown, or you’ve added services, your existing limits might not reflect your current risk.

Why it matters: An outdated policy can leave you exposed to lawsuits, property damage, or bodily injury claims with coverage that doesn't match today’s needs.

What to do: Reevaluate your general liability policy annually, especially after hiring, expanding offices, or adding new services.

🔄 5. Missing Coverage Reviews & Policy Audits

What’s missing: Most business owners don’t schedule regular insurance reviews. That means you might be paying for coverage you no longer need — or missing key protections you do.

Why it matters: Insurance isn’t “set it and forget it.” Your business changes. So should your coverage.

What to do: Schedule a free policy review with someone who knows your industry. It could save you thousands or give you peace of mind you didn’t know you needed.

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