Real estate brokers work tirelessly with clients to facilitate property transactions, yet errors and omissions (E&O) insurance can provide financial security against legal expenses associated with mistakes in services rendered. E&O insurance is more commonly known as professional liability coverage.
Mistakes happen more frequently than you think, even among experienced real estate agents. If, for example, you fail to disclose a crack in a home’s foundation which leads to expensive repairs, your client could sue. An E&O policy provides coverage against such legal expenses as well as other related costs.
An E&O policy can offer protection from most common errors, but it doesn’t cover everything – for instance, property damage caused by you or knowledge of polluted properties aren’t usually covered. Also keep in mind that an E&O policy shouldn’t replace general liability insurance coverage which many businesses require as well.
To minimize your risk of making mistakes, the best way to reduce errors is through practicing high professionalism and communicating clearly with clients. Furthermore, best practices for paperwork submission such as notarization should also be adhered to – newer brokers should check whether their agency provides subsidization of E&O insurance if applicable.
Acquiring E&O insurance for real estate is simple, but to maximize its effectiveness it’s essential that you are clear on your duties and responsibilities as an agent. In particular, be wary about misleading your clients while not disclosing information that violates laws.
Remember that your E&O policy won’t cover you if you engage in fraudulent or criminal acts such as theft, bribery or forgery; your real estate agent E&O policy won’t also protect against statements that violate state or federal regulations.
Errors and Omissions Insurance (E&O) coverage is essential to the success of any real estate agent, broker or franchise/firm owner. With NEXT Insurance’s convenient E&O policy purchase platform, getting quotes tailored specifically to your business can be simple. Simply answer a few simple questions for a free online quote that meets all of your business needs – with cancellation of coverage available whenever needed! Also take advantage of discounted general liability policies available as part of bundle options to save even more with every policy purchase bundled together with general E&O coverages available as part of bundle discounts so start shopping around today to see what savings await you!