Failing IT infrastructure can cost real estate brokers money. There can be costly outages and potential loss of systems and important data. Brokers may even face a lawsuit if your failing infrastructure causes delays and additional costs to your clients or others. Here are the risk factors and how real estate brokers can avoid a lawsuit.
Risk Factors
Ageing IT Systems That Fail
Failing IT systems can result in unplanned outages, server crashes, and other malfunctions.
Painfully slow IT systems can also have a big impact on productivity. When systems fail and everything grinds to a halt, your team cannot work effectively. These failures can lead to delayed paperwork, a poor customer experience, and even disruptions to closings. And, as we all know, once system failures start causing headaches for clients, real estate brokers are likely to face lawsuits. This can lead to reputational damage and a poor image for your brokerage as well as potential financial losses that could lead to you losing future work (or your business).
Vulnerability to Cyber Attacks
Failing IT infrastructure can also make your real estate brokerage vulnerable to cyber attacks. Brokerages collect a range of information from clients that could be targeted by hackers. This includes personal information, identification documents if you accept checks, and bank account numbers. If your brokerage is hacked, cyber criminals may even take over your email or change bank account details to steal funds.
Cyber attacks and the loss of confidential information can be damaging in more ways than one. If your clients suffer from identity theft or they’re defrauded of their hard-earned money as a result of your system’s failure, they may launch a lawsuit against you. It is so important to ensure you have up-to-date IT systems with modern security features to protect against cyber crime and hackers.
Loss of Important Client Information
You don’t have to have your IT systems hacked to lose important client information. Failing IT systems and servers can shut down your business and cause you to lose important data, never to be recovered. Can you imagine losing all of your client and transaction information and needing to piece together your business operations again from scratch? This could create irreparable damage to your real estate business.
Tips for Brokers To Reduce the Chance of Facing a Lawsuit
Risk Management
Real estate brokers need to have appropriate risk management practices in place. You need to include IT infrastructure in your risk assessments and regularly review your mitigation strategies to ensure you’re on top of any high-risk issues.
Regular systems checks and maintenance
It is not uncommon for real estate brokerages to outsource the installation of IT systems. But, it’s important to remember that this is not a “set it and forget it” process. Regular systems checks and maintenance need to happen to ensure your IT infrastructure is working properly. Troubleshoot any problems immediately so they don’t turn into complex problems that can damage your real estate business.
Backups are another important part of regular maintenance. Whether you have a standalone server off-site, or you have cloud-based systems, it makes sense to do regular backups in case something goes wrong. How often you backup your systems will depend on your brokerage. Some brokers do these daily, while others do it at longer intervals.
As cyber crime is becoming increasingly common, you should also ensure you have appropriate cyber security systems, firewalls, and virus protection in place to protect your systems. These typically need constant updates due to cyber criminals finding new sophisticated ways to hack into or damage systems.
Upgrade systems when they’re no longer usable
As technology advances, the need for more memory and capability in your IT infrastructure also increases. Brokers need to ensure IT systems are capable of running efficiently. Upgrades need to be made periodically. Ideally, as a broker, you should allocate funding in your annual budget to cover any potential IT upgrades. You may not need to upgrade your infrastructure every year — but, this is a great way to ensure you have the funding when it becomes an urgent matter.
Get professional IT advice
Real estate brokers are experts in real estate – not typically IT-trained, technological infrastructure experts. It can be very difficult for a real estate broker to be able to monitor your IT infrastructure and cybersecurity needs effectively without some professional help. For some large brokerage firms, this is managed in-house by an IT professional. For smaller brokerages, you might choose to engage a professional IT contractor. Either way, getting some professional IT advice is highly recommended. This will ensure your systems are maintained properly, safe from cyber attacks, and working as effectively as possible.
Review your insurance
Insurance is an essential part of any real estate broker’s business. As part of one of the largest insurance brokers in the world, we have access to more insurance options for real estate brokers than just about anyone. Let us do the shopping for you.
Contact the friendly team at CRES at 800-880-2747 and ask about a Business Owner’s Policy. We can customize a policy to specifically suit the needs of your brokerage.
CRES also offers comprehensive Cyber Liability insurance. This provides real estate professionals with a broader level of coverage, including protection against cyber attacks, ransomware, and wire fraud.
Failing IT infrastructure is just one of the many risks that real estate brokers face in modern real estate. Avoid disruption, outages, and lawsuits, and ensure your IT infrastructure is working today.
