As a real estate broker, you are at the center of huge financial transactions every day. From families investing their life savings into their dream home or businesses expanding with new commercial space purchases for expansion purposes – your daily activities as a broker involve making enormous financial decisions which carry some degree of risk. Even with your best intentions and processes in place, mistakes do happen and when they do occur you could find yourself facing lawsuits or financial losses which require real estate broker E&O insurance policies as protection for both career and finances.

Errors and Omissions Insurance, commonly referred to as E&O insurance, is tailored specifically for real estate brokers and agents. Franchises require this coverage by law in certain states for those working in this industry; its comprehensive risk mitigation benefits protect personal assets while upholding professional integrity while helping build client trust within an inherently volatile and litigious sector.

E&O coverage not only protects your reputation, but can also cover legal fees or damages from claims brought against you. This could include claims related to misrepresenting a property’s square footage or failing to disclose known issues such as mold or structural damage in its disclosure report. It may even cover expenses such as home inspection, title search, or expenses incurred while defending against a claim.

E&O insurance is essential for real estate professionals of all kinds, but is particularly critical if they own or run independent brokerages. An error or omission could ruin their reputation and drive customers away; moreover, many large mortgage brokers, real estate appraisers, and inspectors require contractors to carry this coverage as part of the service they provide to clients.

There are insurance carriers who specialize in E&O bundles tailored specifically to real estate professionals, providing policies with both E&O protection as well as cyber insurance to shield against data breaches or cyber threats.

Real estate agents who bundle policies may opt to purchase individual Errors & Omissions policies; others rely on their brokerages to offer them one as part of the monthly desk fee. No matter the route taken, it is imperative that you review all aspects of your policy to ensure a full understanding of who is covered; what types of errors or omissions are covered; coverage needs and costs associated with such policies as well as how office policies might impact them. As such, you can rest easy knowing that you are purchasing the most comprehensive and accurate E&O insurance policy available for real estate professionals. The National Association of Realtors has produced two documents to assist with understanding your E&O insurance policy better: an in-depth summary (the “Summary”) and tri-fold brochure that highlights key points (the “Brochure”). You can download both below.