Errors and omissions insurance (also known as E&O insurance) helps real estate agents avoid costly legal battles caused by errors made while acting with good intentions, while errors and omissions insurance (or E&O for short) helps minimize financial repercussions of disputes that result. Some clients even require this coverage before doing business with you!
Consider purchasing E&O coverage for several reasons. First and foremost, the financial implications of being sued could be devastating to your small business and could even ruin its reputation in your local community. With appropriate E&O insurance in place, your business can protect itself from these potential losses while maintaining positive relations in its local environment.
Your real estate business requires specific coverage depending on its scope, but the good news is there are numerous E&O policies designed to meet any firm’s needs. Coverage options will typically affect premium costs; therefore, speaking with an E&O specialist to select suitable protection is recommended.
An E&O policy can protect both real estate brokerages and individual agents from potential claims related to real estate transactions. Such policies often cover issues like failure to disclose information that could influence a client’s decision when purchasing or selling property; as well as covering costs associated with defending claims or damages caused by miscommunication during transactions.
Insurance policies vary greatly in their specifics, so make sure to carefully read through and comprehend any exclusions in your policy. For instance, many E&O policies exclude claims related to agent-owned transactions as well as failing to notify sellers about previous water or flood damage that might affect a sale.
When choosing a real estate E&O policy, it’s essential to carefully consider all of the activities your team engages in on an everyday basis. For example, if your company offers showings and open houses, make sure your E&O policy covers these activities; otherwise if transactions completed through licensed brokers only are covered, seek an individual policy which covers these activities too.
Noting the cost of an E&O policy varies with its nature and severity of claims is essential when attempting to estimate its cost for real estate E&O policies. A knowledgeable insurance professional must conduct a risk analysis in order to understand your unique exposures and needs – PBI Group offers E&O insurance experts who specialize in real estate E&O policies who can assist with selecting one suitable to your business needs. To get started today contact one!