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Your Real Estate Signage — Could it Cause a Lawsuit?

Signage is an important part of a real estate agent’s marketing toolkit. Professional signage, whether it’s posted outside of the property or elsewhere in the neighborhood to promote an open house, can increase your leads and attract potential buyers. Real estate signs sell properties faster. But, like everything in business, there are some risks associated with signage which agents need to be aware of. If you fail to mitigate these risks, you may find yourself facing a lawsuit.

There are 2 main areas of risk:  One is regulations (city, area, or homeowners association).  The other is injury or damage your signs could cause.

Compliance with City or Area Regulations

For example, in San Diego, a sign permit is required for the installation of all signs, with some exceptions. Fortunately, one of these exceptions is real estate signs that are not illuminated.   That means you don’t need to apply for a permit every time you want to post a sign in front of a property you wish to sell, rent, or lease.

Within San Diego County, there are some areas that don’t allow “for sale” signs on property at all, such as La Jolla.  (Temporary “day of” open house signs are okay.)  So be sure to check your local and state regulations for specific requirements.

Real estate agents are expected to maintain signs and assure they are well kept. This means keeping a close eye on any damage caused by graffiti, or weather-related damage causing cracking or peeling paint.

If you would like to install any out-of-the-ordinary signage to help sell a property, you should contact your local authority to ensure you comply with their structural requirements and regulations. A formal application and permit may be required if you’re installing a large sign on a property, awning or canopy signs greater than 6 feet, or roof-mounted signs.

Compliance with Relevant Homeowners Association Rules (if applicable)

If you’re selling a property subject to Homeowners Association Rules, check the bylaws and regulations about erecting signage in front of the home. Some Associations do not allow “For Sale” signs, while others are restrictive about where exactly you can place them. There have been some cases where Associations have destroyed real estate signage, claiming it does not meet regulations. In addition to the rising cost of wasted signage in these instances, there is also the possibility that you may face a lawsuit by the Homeowners Association if someone were to be injured by your signage.

Safety Considerations:  Personal Injury and Property Damage

Signage needs to be installed with safety in mind. This means ensuring the signs do not pose any risks to passers-by or traffic. Ensure signs are securely fixed to the ground, wall or fence. For temporary directional or “open house” signs in particular, make sure they are not blocking walkways and are easily seen so people don’t inadvertently trip over them. Because these signs tend to be much smaller (sandwich boards are very popular for this purpose), they can sometimes be a tripping hazard.

Real estate signs need to withstand the elements and all manner of weather. Whatever material you use, your signs need to be strong enough to deal with wind, rain, and sun. Wind, especially, can be an issue with some real estate signs, as they have the potential to blow away and cause hazard to people and property, including potentially damaging the property you are trying to sell or lease.

Protecting Yourself Against a Lawsuit

As a real estate agent, you face risks every day in your business. It’s important to protect yourself against potential lawsuits with adequate insurance coverage. CRES specializes in real estate insurance for professionals just like you. CRES E&O policies include coverage you won’t find with many other E&O policies.

  • Most E&O will not cover claims from sign related injuries, but CRES’ Contingent Liability option (also called “Open House and Showings coverage”) can. It covers bodily injury to others for real estate sales activities, like Open Houses, including injuries from the signs used to advertise the property like For Sale or Open House signs.
  • Contingent Liability also protects you if property is damaged during an open house, showing, or other selling activity.

Your policy with CRES is also fully customizable, so you can have protection specifically tailored to your unique business risks.

To give you peace of mind so you can focus on what you do best, contact CRES at 800.880.2747. Let us help you manage your risk, so you can manage your business.

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