Errors and Omissions (E&O) Insurance for Real Estate Professionals is an absolute necessity. If there’s ever any mishandling of confidential data or errors when selling property or giving bad advice to clients, E&O coverage will help fight any lawsuit brought against you, covering legal costs and damages if necessary. As costs and coverage differ greatly between policies, evaluating risks early is key when finding a good fit – don’t wait to compare.
Some states mandate E&O insurance coverage for real estate agents, including Colorado, Idaho, Iowa, Louisiana, Montana, Nebraska, South Dakota and Wyoming. Even if your state doesn’t mandate E&O coverage, purchasing it would still help protect against potential errors while giving you peace of mind to focus on providing top-notch service and closing deals with ease.
Accessing E&O insurance for real estate is relatively straightforward and costs will depend on factors like where your office is, coverage desired, any prior claims and whether a package policy includes general liability and commercial auto coverage.
E&O policies offer important protections to cover financial losses should a client sue you over professional errors or omissions, including legal costs and damages up to your policy limits minus any deductible. Unfortunately, however, E&O doesn’t cover personal injuries or property damages related to real estate services that you provide directly.
Errors and omissions do not always lead to legal claims; nonetheless they can damage client relationships and result in financial losses for your business. Therefore, many professionals purchase E&O insurance to safeguard their businesses in an industry known for its complex nature and litigious atmosphere.
Errors and omissions policies typically cover your brokerage, not you as an individual agent. This means that should a claim be filed against your brokerage, they’ll cover its associated claims costs and settlements while you may need to cover an increased deductible amount than usual.
Brokerage owners can also obtain E&O policies to safeguard their financial interests, although this option will usually cost more due to increased liability due to possible errors on behalf of brokers, which requires their insurer to cover larger potential claims payouts.
Real estate agents can make costly mistakes, from misrepresenting property details to missing deadlines. To prevent costly missteps and errors from occurring, it’s crucial to remain up-to-date on both licensing requirements and industry knowledge. Maintaining accurate records and adhering to stringent protocols are two ways you can reduce risks. For any inquiries related to E&O insurance for real estate, speak with an expert from McGowan Program Administrators (MPA). Your broker can advise on your coverage needs and help to identify exclusions that should be removed from your policy, while adding back any unnecessary exclusions is a great way to enhance coverage and increase overall value of an E&O policy.