Jane Doe finds the perfect bungalow with enough driveway space to park her Airstream RV. Her real estate agent helped her score a great deal and she’s all smiles, but now she’s in need of insurance to cover her new home. Though insurance may often be an afterthought for new home-buyers, working in collaboration with local real estate agents can create better relationships and more referrals.

You can help a real estate agent by consulting their clients on specialized homeowners’ insurance, with a cooperative agreement that is mutually beneficial. This type of relationship is more like a win/win/win. The real estate agent gives better service, the new home buyer gets trusted insurance advice, and you, the insurance agent, create more referral channels and possibly gains a new client.

Insurance brokers and real estate agents are on the same team in different positions on the field. Agents and brokers should have strong communication between parties so that clients know their options for better homeowners’ insurance. With an agent-broker partnership, new homeowners get a great deal backed by a team of professionals, which increase their likelihood of referring your services to a friend.

Building a Professional Relationship

Mortgage lenders usually take care of the insurance process directly with home buyers, so unless a client makes an all-cash offer, most real estate agents don’t get involved in the insurance process. Even when a buyer makes an all-cash offer, they are typically left to research home insurance on their own (unless they’ve got a stellar broker). Real estate agents can offer an added benefit to homeowners by creating a partnership with local insurance agents to understand the different available insurance options. Though it’s not customary for real estate agents to take this extra step, connecting with reputable ones in your area and encouraging them to do so can help the add value to their services and create more of a one-stop shop transaction. Sit down with local real estate agents and fill them in on:

  • What type of homeowners insurance you recommend for an all-cash offer
  • The different levels of coverage and what each can mean when claims are made
  • The difference between replacement value and actual value
  • Companies that typically provide the best rates
  • Explaining floodplains and insurance needs

Advising on Specialty Insurance Needs

We asked Daniel Ihara, a top real estate agent in Honolulu, HI, if he and his team of real estate agents ever work with insurance brokers. Dan’s team takes the extra steps to work with an insurance broker to understand the changing costs of natural disaster insurance for floods and hurricanes every year. Their relationship “is really based on gathering information that [they] need because of flood zones and the high cost of flood insurance. That’s a major challenge for some folks because of the cost, and [they] want to make sure [their] buyers are aware of it prior to purchasing. If they buy in cash, that’s something that we want to help them with.”

Though real estate agents and insurance agents typically don’t work together, the two would better serve their respective client needs by collaborating on natural disaster insurance. Many of the same statistics are used in each discipline to assess value and risk. This relationship can save clients thousands of dollars monthly on an insurance plan that will cover them in case of emergency.

“We do research only because we take it to a whole other level of service. And that’s where our insurance guy comes in. He gives us a report every single year, comes into my office, trains my team on what’s changed over time and really, more importantly, the costs associated with those changes,” Dan explains. “Flood zone maps change every quarter, and so if we don’t know what those are, that could add another 2 to 3 thousand dollars a month to somebody’s holding costs.”

Specialized natural disaster insurance is an extremely important thing real estate agents should communicate with their clients. When real estate agents know the cost of this insurance, they can save buyers thousands of dollars a month.

Working for Clients

Here’s the bottom line: Real estate and insurance agents don’t always need to work together to have successful businesses, but, when it comes to specialized insurance for floods, hurricanes, and even earthquakes, the collaboration between these two entities is extremely important. The collaboration between agents and brokers helps buyers afford, and be informed on, natural disaster home insurance, which keeps their home and family safe. That’s a win on all fronts!