Real estate professionals know that mistakes happen, which puts them at risk of legal action and financial loss. That is why it is imperative for real estate brokers and agents to have E&O insurance for their brokerage; in this article we’ll explore what this cover entails as well as its effectiveness at protecting businesses.
Real estate errors and omissions insurance (E&O) provides real estate brokers and agents with protection against claims for mistakes they make while providing their services, including any settlement costs or damages awarded against them. Policies typically cover this cost as well as damages awarded against you by claimants.
These policies may cover additional expenses incurred as a result of your claim, such as attorney fees or court costs. Unfortunately, general liability, which covers bodily injuries to customers or property damage sustained by clients and employees alike is typically excluded from real estate E&O policies. To minimize risks when working with clients it’s crucial to maintain high professional standards and follow best practices in client management.
Who Needs Real Estate Errors and Omissions Insurance? Real estate errors and omissions insurance is intended for anyone working in the business of selling and leasing commercial and residential properties, including real estate brokers and agents as well as their staff who work together or for them. Some states mandate licensing real estate professionals possess this coverage while others recommend it.
E&O insurance is an essential element of your real estate business, regardless if you’re new or experienced broker, working solo agent or as part of a team. Even the most meticulous real estate professionals may make mistakes due to an industry so heavily regulated with potentially life-changing consequences for clients.
Real estate E&O insurance covers many common errors that occur during real estate transactions, including:
Real estate E&O coverage typically provides for various legal expenses associated with real estate transactions, including costs related to defending against and winning lawsuits, damages awarded by juries or judges, as well as lost revenue or operating expenses due to errors or omissions by brokers and managers.
Errors and omissions not covered by real estate E&O policies include:
Cost-cutting measures in real estate errors and omissions insurance depend on several factors, including brokerage size, structure and limits; you can discover more by speaking with an independent insurance agent or using an online quoting tool.
Victor provides cutting-edge real estate errors and omissions insurance that will keep you competitive in today’s market. Quote, bind and issue policies online within minutes 24-hours a day at affordable members-only pricing for National Association of REALTORS(r). Get a free quote now!