Buying insurance without an insurance broker

[Abad Marroquin]

I am curious to know how many Multifamily investors buy insurance for their properties themselves without an insurance broker. I’ve been trying to educate myself and learn what make a good policy and eventually being able to buy my own commercial insurance for my properties myself to save the 10-20% agent commission. Has anyone done it and if so, what company have you used? Any heads up? 

[J Castro]

A lot of experienced multifamily investors still work through insurance brokers, especially as portfolios get larger or more complex. Not necessarily because they can’t obtain policies directly, but because commercial real estate insurance becomes very nuanced once you start dealing with:

• multiple properties
• older buildings
• liability exposure
• loss runs
• lender requirements
• umbrella coverage
• flood/wind exclusions
• and replacement cost calculations

One common misconception is that the broker commission is always an “extra” cost. In many cases, carriers build commissions into pricing regardless, and strong brokers can sometimes negotiate better terms, identify coverage gaps, or access markets that individual investors may not easily reach on their own.

That said, educating yourself on policy structure is absolutely one of the smartest things an investor can do. Even when using a broker, understanding:

• coinsurance clauses
• vacancy provisions
• ordinance/law coverage
• liability limits
• deductible structures
• business interruption coverage
• and replacement cost vs actual cash value

can save you from major problems later.

Where investors sometimes get into trouble buying directly is focusing too heavily on premium cost while underestimating exclusions and claim limitations. A cheap policy that doesn’t respond properly during a claim can become extremely expensive very quickly.

For smaller portfolios, some investors do go direct through carriers or online commercial platforms, but once portfolios scale, many operators prefer having a broker who specializes specifically in multifamily or investment properties because underwriting standards and lender expectations continue evolving.

Personally, I think the best approach is less about eliminating brokers entirely and more about becoming educated enough that you can properly evaluate whether your broker is actually structuring good coverage and advocating for your portfolio effectively.