Why insurance enters the acquisition process
In an SBA-financed purchase, the lender may request insurance related to a principal, guarantor or key person. The reason, amount and form of documentation are transaction-specific; ask the lender for the written requirement as early as possible.
Build insurance into your closing timeline
Insurance is often one of several items that need to clear before closing. Give the insurance process its own timeline, with time for carrier underwriting, policy issue, lender review and any collateral assignment documentation.
Useful information to gather
- Requested insured person and coverage amount.
- Loan and target closing details.
- Lender contact and specific insurance instructions.
- Existing coverage details, if relevant.
- Any material timing considerations for underwriting.
Coordinate—not just quote
A quote is only one step. The closing process may also require making sure policy documents and assignment paperwork line up with the lender’s instructions. With your authorization, that coordination can be handled with the lending team.