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Agency Insurance Coverage for Home Sales
As a real estate agent, you simply cannot afford to be sued by a client. The harsh reality is, however, that many people are what is referred to as “sue happy.” So, even if you did not intentionally do something to discriminate against someone or to otherwise cause them harm, you might still find yourself facing a lawsuit.
In order to keep yourself protected in case a lawsuit should arise against you, it is essential that you have professional liability in place. With this, which is sometimes referred to as error and omissions coverage, you will be protected if someone experiences damages as the result of your negligence, an error that you have made, or an omission on your part. Even if you win the case against you, E & O will typically pay for the cost of your defense so you don’t have to worry about the lawsuit destroying your business.
In addition to having this professional liability coverage in place, you will need to look into obtaining other types of coverage as well. For example, this insurance does not protect you if you engage in any type of criminal behavior or dishonest acts. Furthermore, you are not protected with this if you cause someone bodily harm or death and you are not covered if you cause damage to someone else’s property. Obtaining general liability and other forms of coverage will help to protect you in these instances. Therefore, when obtaining your E and O policy, you might want to discuss other forms of coverage with your agent in order to make sure you are adequately protected.
In regard to your professional liability insurance, you will also need to determine the terms of your coverage. For example, you will need to decide on the amount of your deductible, which is the money you have to pay out of your own pocket before the agency will pick up the tab. You might have to determine two separate deductibles – one being the deductible for the cost of your defense and the other being the deductible for payment of damages. The higher your deductibles, the less costly your premiums will be.
You will also need to determine the cap on your benefits. In other words, your policy will have limits placed on how much it will pay per incident as well as how much it will pay per year. The lower these limits, the lower your premiums will be. Keep in mind, however, that you will still be responsible for the judgment against you even if your policy cannot completely cover it. Therefore, you do not want to set your limits too low and then find yourself unable to cover the costs of a judgment.
In addition to having a policy in place, you can also protect yourself by having your clients sign waivers if they do not follow your suggestions. For example, if the client decides not to have a home inspection despite your suggestion that he or she does, have that client sign a waiver. That way, if something is wrong with the home when the person moves in, you cannot be held responsible.
If you are ready to start looking for a great policy to keep you and your real estate business protected, take a moment to fill out our simple online form. After answering a few questions, we will be able to match you up with several insurance agencies that provide the type of coverage you desire. We will then pass that information on to them and they will come to you with the best deals they have to offer.
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