Real estate agents, brokers and firms must pay attention to every detail when handling sales transactions for properties such as sales or rentals of real estate. Mistakes may arise that could have costly legal and financial ramifications for your small business; that is why Errors and Omissions (E&O) insurance offers protection from potential claims made against your work.
Even if a claim is unjustified, it can still cost time and money in court and legal fees; these expenses quickly add up, jeopardizing your ability to run your business effectively. Errors and omissions policies provide coverage against such expenses up to the limits of your policy.
Real estate agent E&O insurance protects you in many situations. A client could sue you claiming your advice or assistance caused them financial harm, misrepresenting a property’s value without disclosing important details, mismanaging contracts due to mistakes in work, or failing to provide adequate service.
Errors and Omissions insurance for real estate professionals varies based on your business type and past performance, which will influence its total cost. Your premium may also reflect whether or not you’re considered lower or higher risk, which in turn impacts how much E&O coverage you need. Some policies even offer legal defense coverage – paying attorneys to defend you in any lawsuits filed against them.
Alongside your E&O coverage, it is also wise to consider obtaining a general liability policy to protect yourself against damage done to customers’ properties or personal injuries sustained from doing business with you. Most business owners need workers’ compensation insurance and commercial auto policies for further protection of their small enterprises.
Some real estate agents and brokers opt to purchase individual errors and omissions policies instead of firmwide policies, as this option can often be more cost effective while still offering coverage for activities not covered by firm E&O policies, such as showings and open houses. When buying individual policies it is vital that they offer adequate coverage that covers any specific risks your business poses.
Finding an experienced insurance broker who can assist in purchasing E&O coverage for your real estate business is of utmost importance. PBI Group’s team has written hundreds of E&O policies for real estate agents and brokers throughout the U.S. Reach out today for a quote – we take the time to understand your business so we can offer comprehensive protection against legal liability!