Expanded NAR insurance coverage helps protect local associations

What’s the difference between the words “insure” and “ensure?”

According to Merriam-Webster, ensure means to make sure, certain or safe, or to guarantee. Insure means to provide or obtain insurance on or for.

Perhaps a sample sentence would help:  “The National Association of REALTORS® (NAR) has taken steps to insure your local and state associations, in order to ensure that its liability is reduced if things go wrong.”

Most members tend to think about the NAR Professional Liability insurance plan as a policy that helps associations if they ever get sued.  And in fact, the NAR liability policy does cover situations such as employment discrimination, antitrust, sexual harassment, lockbox administration and personal injury.  But there are a number of lesser-known coverages also included in this policy.

This year NAR added “information asset coverage” and “crime coverage” to the basic policy that covers all compliant associations. Information asset coverage covers associations for losses involving electronic data and information assets.  In short, if your association’s computer security is compromised and you end up with missing or corrupted member data, this policy can help reimburse the association for the costs of recovering or recreating the data.

It is important to know that if such a situation should arise, the association must be following all NAR mandatory policies, and be in compliance with relevant state laws regarding data security,  as well as a number of other requirements imposed as a condition of the insurance (some of which may be required by law anyway).

Crime coverage helps protect associations from employee theft such as embezzlement, theft of money or forging checks. The coverage applies to full- and part-time employees, as well as  any temporary employees. This policy also contains several reporting and other rules in order to access the coverage, including a requirement that the incident be reported to law enforcement authorities if illegal activity is suspected.

Remember that all this good NAR coverage applies only to local and state associations whose governing documents and operations are in full compliance with all of NAR’s policies, rules and regulations.  If your association is not in compliance, you run the risk of being unprotected by these policies.  In today’s litigious society, do you really want to take that risk?