The real estate industry is an exciting one, with the potential to earn a substantial paycheck with enough knowledge and hard work. However, it’s also a field with many unique risks.
Clients rely on professionals in the real estate industry for advice and to represent their interest on their behalf. They are also spending large amounts of money, which can greatly heighten emotions. All these factors create a recipe for potential lawsuits, whether they are caused by a mistake on your part or a misunderstanding on the client’s.
This is where having the right insurance protections in place can greatly benefit your business. Errors & Omissions (E&O) insurance could help protect your real estate business.
What is E&O insurance for real estate businesses?
An E&O insurance policy (also known as Professional Liability insurance) is an essential policy that protects you and your company in case of a lawsuit due to alleged professional wrongdoing.
This includes claims alleging that you have:
- Made an error or mistake in your work
- Omitted relevant information
- Acted in a negligent manner
- Breached the terms of a contract
- Failed to deliver professional services
- Missed deadlines
What does E&O insurance cover?
Liability lawsuits can be lengthy, which also means they can be expensive. Without insurance coverage, these costs would fall on your shoulders. That could be potentially devastating to your real estate business and could also force you to dip into your personal savings as well.
E&O insurance helps remove the financial burden of related lawsuits by paying:
- Legal fees, including hiring an attorney and court costs
How can E&O insurance protect real estate businesses?
Real estate businesses may especially benefit from having an E&O insurance policy. The types of claims mentioned above are fundamental to working in real estate.
There are so many potential moves that could kill a client’s real estate deal. A mistake in a contract, missing an important deadline, forgetting to follow through on promised work, or failing to disclose information (as well as many other events) can all result in financial loss for a client. If you are found liable, you could be ordered to compensate them for this loss.
Even if you have acted professionally and have done your due diligence, a client may still be unhappy with the service you have provided. Defending your business and professional reputation in court can be expensive, even if the claim has no merit.
E&O insurance can provide important protections to real estate businesses by shielding them against both valid and baseless claims that can be brought by clients.
Is E&O insurance the only type of cover for real estate businesses?
While E&O insurance is important for many real estate businesses, it may not be the only form of coverage that you need. Here are three other types of insurance that you might also consider for your small business:
- General Liability – Can protect you against any claim by an outside party regarding injury or damage to their property. In these instances, your policy will cover your legal expenses as well as your cost to replace or remedy the situation.
- Business Owner’s Policy (BOP) – A combination of policies, combining covers such as General Liability insurance and business personal property coverage, to help protect small businesses from costly interruptions to service.
- Workers’ Compensation – Protects you against medical expenses and lawsuits that can arise from employee workplace injuries and illnesses. It could also pay lost wages as a result of the work injuries that an employee sustains.
Where to find E&O insurance for real estate businesses
E&O insurance can provide real estate businesses with important coverage against many of the common liability risks faced within the industry. If you’re ready to buy a policy for your businesses, look no further than BizInsure.
By combining technology with human support, we are bringing easy and affordable insurance options to real estate businesses across the country. Busy small business owners can compare multiple quotes from top-rated insurers, buy online, and receive proof of insurance instantly!
Find E&O insurance for real estate businesses, as well as other forms of coverage that can help protect your small business.