Error’s & Omission’s
Error’s & Omission’s insurance (E&O), also referred to as Professional Liability, is a transaction related policy that protects licensed professionals from issues that arise during and after the close of a transaction.
Who needs Error’s & Omissions?
Real estate brokerages
Transaction coordinators
Property managers
Mortgage brokers / bankers
Escrow companies
Title insurance companies
Real estate appraisers
and several other industries.
Here are a few things you need to know about E&O Insurance:
What is a Retroactive ate, aka “Prior Acts?”
Prior acts, also known as a retroactive date, is the date that your coverage first began. It is crucial to never lose your prior acts coverage as prior transactions will no longer be covered under your E&O policy.
Why is E&O so important?
E&O claims can arise whether you make a mistake or not. When dealing with real estate, you are handling transactions of a larger value and often are an emotional purchase for the client. Not having coverage can have much more costly effect on your business resulting in sleepless nights, or possibly closing down your business.
Most Common E&O Claims
Failure to disclose
Subpoenas
Mediations
Breach of fiduciary duty
Breach of contract
Misrepresentations
How is premium calculated?
The location of your business
Claims history
The volume of your business
How long you have been in business
How many agents/employees you have
Your requested limits and retention
