Real estate errors and omission insurance (E&O) is a type of professional liability coverage designed to assist real estate brokers, agents and appraisers defend themselves from accusations of negligence in their work. E&O insurance provides similar protection as malpractice coverage does for doctors or other professions who provide advice or services for clients; in the event of legal proceedings being brought against the real estate company concerned and legal fees awarded against it as well as damages to its reputation being covered as well.
State laws often mandate real estate professionals carry errors and omissions insurance, with clients potentially asking to see proof before working with them. Errors and omissions policies typically cover damages up to an agreed upon limit, and can be purchased independently of general business policies.
Errors and omissions claims can arise for various reasons. One such cause is when an agent fails to disclose property defects or information relevant to buyers that could lead to financial loss and litigation. Another possible trigger may include when an agent omits information in legal contracts that leads to breaches in terms of agreement – potentially leaving themselves open to lawsuits as well as career disruption.
Though most real estate agents and brokers strive to offer accurate advice and information, mistakes do happen and mistakes can be costly in terms of both fines and penalties. No matter if the claim is justified or not, legal costs can quickly spiral out of control, ruining profits for real estate firms.
Errors and Omissions insurance (E&O) is essential for businesses in these fields. With E&O insurance in place, businesses can hire an attorney to represent their business in legal actions against it as well as negotiate settlements with clients if necessary. If an E&O lawyer demonstrates that any claims are baseless, or proves their firm innocent of blame then any compensation due can be paid from within its limits.
Real estate errors and omissions insurance policies come at various prices and levels of coverage, so it’s wise to get professional advice about which coverage best meets the needs of your real estate business and carefully review each policy to ensure maximum value for money.
Errors and omissions insurance provides additional coverage against cyber incidents that are becoming increasingly frequent in real estate. Some carriers are also expanding their E&O policies to include wire fraud, phishing scams and viruses that could compromise client information on computers or mobile devices.
An errors and omissions policy is an integral component of any real estate business that deals with high-value properties, especially those dealing with large transactions. An E&O policy will protect your reputation while helping keep operations running smoothly while saving you money in the long run. Get in touch with PBI Group now to understand more about risks and costs related to errors and omissions insurance and purchase an E&O policy specifically designed for real estate businesses.