Real estate errors and omissions insurance (E&O), also referred to as E&O coverage, provides protection from the costs of legal defense, damages, or compensation claims that arise due to mistakes or allegations of incompetence on your part. Errors in any line of work can have major repercussions for clients and defending against a claim can be financially devastating to your agency, so it is vital that E&O coverage be considered when running your real estate agency.
Errors & Omissions insurance may be required by certain clients in order to do business with you, while even if it’s not, E&O insurance can serve as a financial safeguard that allows you to avoid potential legal claims against your business and focus on expanding it instead.
No matter if you are just beginning in real estate or overseeing major commercial deals in New York City, having errors and omissions insurance is one of the best ways to safeguard your business and ensure client trust in your agency. Not only can it offer protection against legal claims, but it can also boost client relations while serving as a safeguard for its reputation.
Errors or omissions that lead to legal claims can take many forms; examples include:
Misrepresentation – If a client suspects you of misrepresenting your knowledge of property or industry matters, they could sue you for damages. This is especially likely if they believe you made claims that were overstated or went beyond the level of expertise you possess.
Omission – Similar to misrepresentation, omission involves leaving out information that would affect a client’s decision-making process. For instance, this can mean not disclosing structural defects that affect value or failing to mention neighborhood/school district data that makes a property less desirable.
Physical Injury/Property Damage Coverage – this coverage extends to any damages sustained at an open house, showing or other real estate agent duties, often included as a sublimit in an Errors & Omissions policy.
An Errors and Omissions policy does not protect against environmental pollution or criminal acts committed by its insured, so it’s essential that you review its exclusions section to fully comprehend what’s and isn’t covered.
Victor offers cutting-edge real estate errors & omissions insurance designed specifically to meet the needs of real estate professionals. Our easy online quote, binding and issue system makes quoting and issuing policies in minutes – 24 hours a day! Additionally, NAR members may take advantage of special discounted rates through NAR REALTOR Benefits. Reach out today and learn how you can get optimal coverage with Victor!