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Real Estate Agent Insurance: What You Need to Know

June 07, 2024 | Errors and Omissions

This article was originally published May 27, 2022

As a real estate agent or agency owner, it’s crucial that you have proper insurance coverage for your business. There are a number of policies—what might collectively be called “real estate agent insurance” [link to real estate industry page]—that you need to protect your business from the high cost of liability and losses. That’s because your business faces many risks, including incidents like:

  • A client slips on a wet floor in your office, breaks their wrist, and sues you for the cost of their medical bills and other expenses.
  • An employee develops carpal tunnel syndrome from the typing they do at work, which requires surgery and time off from work.
  • While driving to a client meeting in an agency-leased car, you run a stop sign, striking another vehicle, and are required to pay for damage to i
  • A fire causes damage in your office.
  • Hackers get access to sensitive client information in your possession and use it to defraud them. A liability lawsuit exceeds the limits of your cyber insurance policy and you need additional coverage.

These aren’t unlikely hypotheticals—they happen regularly to real estate agents and agencies around the country. Fortunately, reassuring financial protection is available and affordable.

Couple getting house keys

7 Policies Most Real Estate Agents Need

Every real estate business is unique and, consequently, has unique business insurance needs. But there are seven types of insurance that are most commonly required for real estate agents. They are: 

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    Errors and omissions (E&O) insurance. The offer-writing example above is one where you’ve failed to meet a commonly understood standard for your profession—that is, submitting offers correctly. That error could make you liable for your client’s financial damages. Similarly, if you missed a critical deadline and your client suffered a loss, you could be required to pay.
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    Workers’ compensation insurance. This coverage protects your company if an employee is injured, gets sick, or dies as a result of an on-the-job incident. The carpal tunnel syndrome scenario above would be an example of where workman's comp, as it’s sometimes called, could keep your business from having to pay costs associated with the person’s condition.
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    General liability insurance. Slip-and-fall incidents involving visitors are the most common example mentioned for general liability insurance. But it also covers damage to the property of others, slander, libel, and copyright infringement. For instance, if you were attending a showing with a client and you damaged the seller’s flatscreen TV, this type of insurance could cover the cost.
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    Business owners policy (BOP). Also called property & liability insurance, a BOP combines general liability insurance with coverage for company property. That means it could cover both the slip-and-fall incident and the office fire noted above.
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    Commercial auto insurance. Any time you get behind the wheel of a company-owned or leased vehicle, there’s a risk of being at fault in an accident. And when accidents occur, lawsuits and judgments frequently follow.
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    Cyber insurance. This coverage is purchased as an add-on to a BOP, general liability policy, or E&O policy. It can protect you if, for example, cybercriminals steal your laptop and get access to a client’s financial information.
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    Umbrella insurance.Liability insurance policies (general liability, commercial auto, etc.) all have a maximum amount they will pay. Umbrella insurance can provide additional payment if that amount is exceeded for a covered risk.

Having the policies on this list that are pertinent to your business helps protect you from large—potentially catastrophic—financial burdens.

Real Estate Errors and Omissions Insurance: Particularly Important for Real Estate Agents

Real estate is a business where, in many instances, decisions have to be made and actions taken within a tight timeframe. It’s also an industry where clients have both financial and emotional stakes in their transactions. 

Consequently, it’s not uncommon for real estate agents to be sued by clients for alleged mistakes. So, while all the policies above are important, real estate errors and omission insurance is a coverage that you definitely should have. Also called professional liability insurance, this type of policy enables you to do your job confidently and not worry about being hit with a crushing court judgment.

What Does Real Estate Errors and Omissions Insurance Cost?

Multiple factors are considered when determining your real estate errors and omissions insurance cost. However, at biBERK, E&O policies start at around $450. 

Getting a quote for your specific E&O insurance cost, or your cost for any type of policy, is easy. You can do that online at your convenience. And if you have questions, our licensed insurance experts are happy to assist you.