Real Estate Agent’s Insurance | Errors and Omissions

Professional Liability

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 Types of Real Estate Professionals


Add-Ons and Bundles

Real Estate Agent’s Insurance Covers Various Professionals


  • Real Estate Agent
  • Real Estate Broker
  • Real Estate Property Manager
  • Leasing Agent
  • Real Estate Attorney
  • Real Estate Transactions Coordinator
  • Real Estate Assistants
  • Real Estate Financial Analyst/Consultant
  • Real Estate Investor
  • Real Estate Developer
  • Real Estate Appraiser
  • Real Estate Escrow Officer
  • Real Estate Inspector
  • Real Estate Loan Officer
  • Commercial Real Estate Agent
  • Seller’s Agents
  • Buyer’s Agents
  • Industrial Real Estate

What is Real Estate Agent’s Insurance and Why Should You Purchase It?



We live in a world where lawsuits are becoming more common.  As with any other professional, Real Estate Agents also need Professional Liability Insurance (which is also known as Errors and Omissions or E&O).

Simply put, this is because claims can be expensive.  Several claims filed against you or your business can tarnish your reputation among clients, making you lose customers and can even lead to the business’ failure.

That’s why it’s important that you take the necessary steps to protect yourself as a professional or business owner.

Professional Liability for real estate agents covers the following:

  • false claims (such as buyer’s remorse and wrongful discrimination)
  • misrepresentation
  • failure to take care of the client’s needs
  • inaccurate advice

However, Professional Liability doesn’t cover everything though.  Here are a few examples of what Professional Liability doesn’t cover:


  • employee injuries and bodily harm
  • data breaches that reveal client’s information
  • commercial vehicle damage

Things to Consider Before Purchasing Real Estate Agent’s Insurance


Consider timing.

Real Estate Agent’s Insurance works on a claims-made basis.  What does that mean?  Simply put, it means that the date the claim is made matters. Why?  Because, it determines which policy term will be in charge of responding to the claim.

Essentially, the date of the event doesn’t matter just the date the claim is being made.

In addition, insurance policies typically have a retroactive date. Basically, this covers claims between the retroactive date and the policy start date.

If you want to ensure that your past claims are covered, you’ll want the retroactive date to be the date that you started your business.

Thus, it is important to take this into consideration when you are buying Real Estate Errors and Omissions Insurance.

What you should know about legal representation and defense.

Insurance companies usually provide defense attorneys on your behalf. Why? Well, consider this for a moment:

If you were to provide your own attorney then that attorney may be over the price of what insurance can cover.

Further, this is why insurance provides you with an attorney. It’s because they will find someone who will be covered based on your policy. But, this is also because insurance usually has negotiated rates with law firms.

Here’s another thing to consider: defense costs are taken into consideration when paying for damages. What does this mean?

Let’s refer to an example. Let’s say you have a $2,000,000 claims limit. If the defense costs $1,000,000 then that means you only have $1,000,000 left to pay the damages.

This is something to consider when choosing your claims limit.

Does my company protect me? If so, to what extent?

Before making any type of insurance purchase, double-check with your employer to make sure that your company doesn’t already offer you coverage.

Obviously, if your company already protects you then you don’t want to accidentally purchase something additional that you don’t need.

But most importantly, you want to make sure that your company protects you as an individual employee.  In many scenarios, the company buys policy for the entire organization, but that policy doesn’t necessarily cover you as a specific employee.

If you aren’t fully protected, or as protected as you’d like to be, then purchasing Real Estate Agent’s Insurance may be in your best interest.

What if I own my firm?

If you own a firm then you may want to look into other policies that protect you and your employees. 

Also, owning a firm can have an impact on your insurance quote.  So, be sure to click “Customize Quote” below to see what you’d pay.

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Get a free quote to see how much you’d pay


There are a range of factors that may influence your quotation.  For example, your area of practice, your location, and your salary can all have an impact on your insurance quote. 

Above all, it is our goal to give you a fair and accurate estimate.  Below, we’ve provided a place where you can input this information.

So, if you’re interested in customizing your quote to see what your rate would look like, click on “Customize Quote” below.

Three Ways That You Can Protect Yourself From E&O Claims as a Real Estate Agent


  1. Give accurate information about a property

As you probably already know, this is extremely important.  Mostly, because if you give a client inaccurate information about a property then that gives the client a reason to sue.  Also, it damages your credibility as a real estate professional.

Thus, you should always let a client know if a property has any faults.  In addition, you should make sure that your facts about the property are true.  To do this, check in with the seller to make sure your details are correct.

2. Make sure the advice that you give the client is accurate

This sounds like common sense, but it’s a good reminder.  Mainly because clients can sue you for giving them false information, even if all you’re trying to do is help them.

Keeping this in mind, it’s always a good idea to make sure that the advice you give is both sound and true.  As always, if you don’t know the answer to a client’s question or you aren’t sure, you’ll want to point them to another professional who knows the answer.

3. Watch the inspectors that you choose

If you choose an inspector that misses, for example, improper electrical wiring in a home, then the client can sue you for this.

Because of this risk, you’ll want to make sure that you’re choosing an inspector with a good reputation and a lot of expertise.

Other Types of Insurance for Real Estate Professionals

Even Professional Liability won’t cover certain work mishaps.  As a Real Estate Agent, you’ll want to check out some of these policies.  Especially if you want to make sure you are additionally protected.

Commercial Auto Insurance

This type of policy covers your business’ vehicle.  It also covers medical bills, car damage, and the legal bills.  If you want to know more about Commercial Auto Insurance click “Commercial” then “Auto.”

Worker's Compensation Insurance

Firstly, the price of this policy depends on the number of workers in your business and the occupational risk.  This means it can range anywhere between $800-$1200 per year.  More importantly, however, is that it covers medical bills from job-related injuries and wage replacements for recovery time.

Data Insurance

A policy like this is especially helpful for those working in the technology sector. It covers data breaches and cyber theft in the case of data hacks. Notably, it pays for the legal fees, rebuilding costs, and reputations that are associated with these types of claims.


Many insurance plans are commonly bundled together for simplicity and a cheaper rate.

Business owner’s policy (BOP)

A popular option for small businesses like clothing boutiques that combines Commercial General Liability insurance with Commercial Property insurance, usually at a cheaper price than if the two were purchased separately.

Real Estate Agent’s Insurance FAQ

Is it necessary for me to purchase Real Estate Agent's Insurance?

Technically you don’t need it – unless you’re living in states that require it.  That said, here are some of the states that require E&O Insurance for real estate agents:

  • Iowa
  • Alaska
  • Mississippi
  • North Dakota
  • South Dakota
  • Tennessee
  • Colorado
  • Kentucky
  • Nebraska
  • Rhode Island
  • Wyoming
  • Idaho
  • Louisiana
  • New Mexico

Even though it’s not required in some states, Errors and Omissions Insurance can protect you if a client files a claim against you.  Especially, if you can’t afford to pay for it.

What are the pros and cons to buying this type of insurance?

Here are some of the pros to buying this type of insurance:

  • It can cover incidents that cause financial harm to the client.  It also makes sure you are protected from false claims made against you.
  • It will help clients and others see you as a reputable professional.
  • It will help you stress less when expensive claims are made against you.

Here are some cons to this policy that you may want to consider:

  • It only covers aspects.  It does not cover injuries sustained by employees.
  • The cost is dependent on a variety of factors.
  • You won’t be able to control the premium.

Is there a difference between Errors and Omissions Insurance for Real Estate Agents and Professional Liability Insurance?

Nope, there isn’t a difference.  In fact, Professional Liability Insurance and Errors and Omissions Insurance mean the same thing, and they offer the same coverage.  Professional Liability Insurance is just another name for Errors and Omissions Insurance.

What are examples of claims that would fall under Real Estate Agent's Insurance?

Example #1:

You show a client a home and claim that the home is 1,500 square feet.  After viewing the home, the client decides they love the home and they’d like to put in an offer.  As a result, the seller ends up accepting the clients offer.  However, in the contract the client finds that the home is not 1,500 square feet like you said it was.  Instead it is 1,050 square feet.  Unfortunately you accidentally got the two numbers mixed up.

But it doesn’t matter, because the client files a claim against you saying that you gave them false and misleading information about the property. 

Example #2:

You’re so excited.  Mainly because you’re about to receive a huge commission from a client on a property if the home inspection goes well.  The home inspection goes extremely well – better than expected.  And, the inspector claims that there weren’t any issues that he could spot within the house.  After hearing this news, you’re ecstatic.  The contract goes through and you get your commission. 

However, less than a year later, the former client contacts you and says that they have to redo their plumbing because there’s something wrong with it.  As a result, they sue you for negligence, even though the inspector is the one who should’ve noticed the problem.

Example #3:

You and your client have both agreed to a strict timeline for helping them find their dream property.  Recently, due to the heavy workload, you’ve been falling behind on that deadline.  Because of this, you’ve failed to meet the terms on the contract and the client recognizes this.  As a result, the client sues you for a breach of contract.

When should I buy Errors and Omissions Insurance?

Ideally, you’ll want to purchase this type of policy as soon as you open your business. Or, similarly, as soon as you find out that your company doesn’t cover you as an employee.

That is to say, when this policy is enacted it covers incident claims and lawsuits. On the contrary, if you don’t have the policy, it will not cover any incidents or lawsuits.

What payment methods do we accept?

We accept payments through a mortgage, direct billing through mail, EFT (Bank Account), debit and credit cards.

How can I file a claim?

We strongly recommend calling us before the insurance carrier directly about a claim. You may not want to file a claim depending on your insurance plan. However, we will assist you in filling a claim the best way to make sure you take the least amount of damage possible to your insurance score.

After talking with us, you can call the insurance carrier or let us call them for you.

If you can’t find your answer here, please don’t hesitate to ask a representative through our messaging system or email.