Errors and Omissions coverage for Note Holding LLC

[Joshua Andrews]

Hey Guys and Gals - I am wondering what type of insurance you may have on your LLC. Specifically an LLC that holds notes for cash flow. I am assuming the coverage would be for Errors and Omissions, since there really are no moving parts like an office, staff lawsuits trip and fall, or renters suing you. What is more likely is a homeowner suing for some misstep in lending.

I am curious how others have utilized insurance to help minimize risk for their LLC?

Thanks!

Josh

[Dion DePaoli]

It is not overly clear what you are trying to insure against.  You would carry O&E if you are originating or servicing loans.  There are fairly standard policies in the market for this type of situation.  Not a bad idea to carry if you are just investing but there is a bit of a cost barrier to them.  If your not performing an action, like in servicing or origination it is hard to think of a possible claim that could cause a lot of trouble.  That might lead to more of a General Liability policy.  Any insurance agent can go in deeper with you.  Shop around.