Real estate transactions can go wrong in any number of ways, and even one mistake could cause clients to sue your business. That is why errors and omissions (E&O) insurance is essential for real estate professionals.
E&O insurance provides financial support to a business when faced with legal action for errors such as misrepresentation, negligence or failure to perform duties resulting in financial damages. It’s often included as part of real estate professional liability policies or sold as standalone coverage – whether that means forgetting to disclose foundation issues prior to closing or failing to submit required documentation when selling property, real estate errors and omissions can be costly and destroy reputation.
E&O insurance policies are specially tailored to meet the risks faced by real estate professionals and their businesses. While standard business policies typically provide some level of E&O coverage, they often don’t meet all of your specific needs as an appraiser, escrow officer, mortgage banker, property manager, transaction coordinator or transaction coordinator professional. Our experts can assist with finding you an E&O policy tailored specifically for you that can provide comprehensive risk mitigation.
Many real estate E&O policies provide coverage to all the brokers and agents working at one firm – known as “firm” E&O policies – at once. This type of coverage is often required by states requiring E&O insurance as well as popular among licensed brokerage firms; however, if you leave or become inactive as a broker then either an individual policy must be obtained or tail coverage bought out until such time when your group E&O coverage ends.
Real estate professionals face numerous business risks in addition to E&O insurance, such as commercial auto and general liability policies. While general liability policies cover risks such as customer injuries, damaged customer property and advertising injuries, the risks involved with real estate can often be more complex – leading to potential legal claims against your business. Our experts are available to help select a policy tailored specifically for real estate risks or bundle them together with other policies when necessary.
New York requires that every real estate licensee maintain an Errors & Omissions (E&O) policy to protect both themselves and their clients against the financial repercussions of professional errors. E&O insurance can be purchased easily and affordably when customized specifically to the risks present in real estate brokerage practices. For more information, download our free Errors & Omissions Insurance Real Estate Broker brochure or reach out for further guidance.