If you're running a property management business in Florida—or thinking about starting one—you've probably wondered what insurance you actually need. Here's the thing: Florida doesn't require you to buy insurance just to get your real estate broker license. But here's what surprises most new property managers: your clients, contracts, and practical business risks will force your hand anyway. Let's walk through what you really need to protect your business in 2026.
Licensing and Legal Requirements for Florida Property Managers
First, let's clear up a common misconception: Florida doesn't have a separate "property management license." Instead, property managers who earn commissions from handling rentals and leases need a real estate broker license. This falls under Florida's existing real estate licensing laws, because renting and leasing are considered real estate activities.
And here's where it gets interesting: unlike contractors, who must show proof of specific insurance amounts to get licensed, property managers face no state-mandated insurance requirements to obtain their broker license. The state of Florida won't ask you to prove you have general liability or E&O coverage when you apply. But don't celebrate yet—your clients and contracts will.
Workers' Compensation: The One Mandatory Insurance
Workers' compensation is the one insurance you absolutely cannot skip in Florida—if you have employees. Property management is classified as a non-construction business, which means you're required to carry workers' comp if you have four or more employees. This includes corporate officers and LLC members, so you can't work around it by creative structuring.
Now, if your property management business also does construction-related work (like managing renovation projects or handling maintenance crews), the threshold drops to just one employee. Construction businesses in Florida must have workers' comp for every single employee, no exceptions.
Your workers' comp rates depend on classification codes. Property management employees fall into two main categories: Class Code 9012 covers leasing agents, property managers, clerical staff, and salespeople. Class Code 9015 covers maintenance employees, superintendents, doormen, security desk workers, and custodial staff. The maintenance and security roles typically cost more to insure because they carry higher injury risks.
Small operators have some flexibility: sole proprietors and partnerships can file for an exemption certificate and go without coverage. Non-construction companies can have up to ten exemptions, while construction-related companies max out at three. But exempting yourself means you're not covered if you get hurt on the job—something to think hard about.
General Liability Insurance: What Your Contracts Will Demand
General liability (GL) insurance protects your business when someone gets injured at a property you manage, or when you accidentally damage someone's property. A tenant slips on a wet floor during your inspection? That's GL. A contractor you hired damages a neighbor's fence? Also GL.
While Florida doesn't mandate minimum GL coverage amounts for property managers by law, your property owners and HOAs will. Most property management contracts require proof of GL insurance with at least $300,000 in liability coverage. But here's what's actually happening in 2026: $1 million in coverage has become the industry standard. Owners want to know you're protected against serious claims, and many won't sign a management agreement without seeing that seven-figure policy.
Additionally, expect to be asked to add property owners as "additional insured" on your GL policy. This means they get protection under your policy if they're named in a lawsuit related to your management activities. It's standard practice, not a red flag.
Errors and Omissions: Protection for Professional Mistakes
This is where many new property managers get caught off guard. Errors and omissions (E&O) insurance—also called professional liability—covers you when clients claim you made mistakes that cost them money. Did you forget to process a rent payment correctly? Fail to enforce a lease provision that led to property damage? Miss a critical deadline for an eviction? E&O covers the legal costs and damages.
Here's the real kicker: E&O also typically covers tenant discrimination claims. Fair housing lawsuits are a major exposure for property managers, and they're not covered by your general liability policy. If a prospective tenant claims you rejected their application based on a protected class, you need E&O coverage to defend yourself and pay settlements if necessary.
Professional liability claims can be expensive—not just in legal fees but in lost reputation. Even if you win, defending yourself can cost tens of thousands. E&O insurance gives you the resources to fight frivolous claims without draining your business bank account.
Additional Coverage and Contractor Requirements
If you or your employees drive for business—showing properties, conducting inspections, meeting vendors—you need commercial auto insurance. Don't rely on personal auto policies; they won't cover accidents that happen during business activities. Additionally, consider hired and non-owned auto (HNOA) coverage. This protects you when employees use their personal vehicles for work tasks, like picking up keys or dropping off notices.
Speaking of vendors: any subcontractors or maintenance workers you hire should carry their own commercial general liability policy with at least $1 million per occurrence. They should name your property management company as an additional insured on their policies. Make it a practice to collect certificates of insurance (COIs) from all contractors annually. This isn't just good risk management—it protects you from liability if a contractor causes damage or injury while working on properties you manage.
Consider cyber liability insurance as well. Property management involves handling sensitive data—Social Security numbers, bank account information, credit reports. A data breach could expose you to significant liability and regulatory penalties. Cyber insurance covers forensic investigations, notification costs, credit monitoring for affected individuals, and legal defense.
How to Get Started with Property Management Insurance
Start by taking inventory of your risks. How many employees do you have? Do you manage residential, commercial, or both? Do you handle maintenance in-house or hire contractors? Are you working with HOAs or individual owners? Your answers shape your coverage needs.
Next, review your existing management agreements. What insurance do your contracts require? Look for minimum liability limits, additional insured requirements, and any specific coverage types mentioned. If you're just starting out, research what competitors in your market typically carry—this gives you a baseline.
Work with an insurance agent who specializes in property management or commercial coverage. They understand your industry's unique risks and can package policies efficiently. Many property management insurers offer business owner's policies (BOPs) that bundle general liability, property coverage, and business interruption insurance at a lower cost than buying each separately.
Bottom line: Florida gives you flexibility on insurance requirements for licensing, but your business reality won't. Between workers' comp mandates, client contract demands, and the genuine risks you face daily, you need comprehensive coverage. The good news? Proper insurance isn't just protection—it's a competitive advantage. Property owners feel more confident signing with managers who carry robust coverage. It signals professionalism and stability. Get quotes from multiple insurers, compare coverage details carefully, and invest in protection that lets you grow your business without constant worry about catastrophic claims.
