An extremely specialized form of professional liability insurance — designed to protect the agent and the brokerage from the risks of real estate transactions. Your most important and most-used policy.
E&O insurance for real estate professionals is an extremely specialized form of professional liability insurance — designed to protect the real estate agent and the brokerage from the risks associated with real estate transactions. These policies are your most important and most often used form of insurance a real estate agency can invest in.
For this reason, it is critical to secure a policy that is aligned with the type of real estate business your agency conducts. Errors and omissions insurance for real estate agents can vary drastically from one insurance company to another, and it is extremely important to have an expert in real estate E&O as your trusted insurance guide to ensure you have the Right Coverage at the Right Price.
At PBI Group, we work hard to balance the cost of insurance with the protection it must provide — by giving you access to one of the strongest policies on the market.
All professional services have their own form of E&O insurance to protect them from any errors or mistakes that may arise from conducting business with their clients. Real estate professionals — like other service professionals such as accountants, lawyers, doctors, and architects — have specific risks that relate to their industry and business.
Real estate is a fast-paced, often risky business with high-value transactions that are complicated and filled with emotionally invested clients. Trust is the cornerstone of a real estate agent's relationship with their client, and if that trust is broken for any reason, it could lead to an E&O claim. Errors and omissions insurance real estate claims can be filed against a real estate agent for almost any mistake — real or perceived — or omission that a client feels harmed their transaction. When that time comes, it is important to have the best policy available to protect yourself and your company.
E&O insurance covers any person — employee or independent contractor — performing real estate services on behalf of the named insured entity listed on the insurance policy. PBI Group's firm-wide insurance policies are written for the business entity that owns the real estate brokerage, which can have numerous real estate agents or brokers performing transactions on the company's behalf. The insurance company does not distinguish between real estate agents or real estate brokers; for the purpose of the insurance coverage, both are considered a real estate professional.
At the most basic level, the coverage provided by errors and omissions insurance handles defense costs, legal costs, and court costs related to a claim. The insurance company is obligated to pay for expenses to defend the claim, and any monetary settlements that may arise when dealing with the claim (minus the deductible).
What scenarios are covered vs. not covered by the insurance policy are too many to list — however, common topics that a reputable E&O insurance company provides coverage for include:
As you can imagine, the coverages are extremely detailed and nuanced — with their interpretation a matter of law. This is why selecting the right protection requires a real estate E&O expert to guide you through the policy and ensure the coverages are configured properly so the insurance company will step up when you need them most.
PBI Group's insurance program — with exclusive access to Palomar Specialty Insurance Company, an A rated carrier focused on real estate — provides our clients with one of the strongest policies available for real estate agents. Our term coverage and extended reporting period policies are underwritten with care and precision to provide the Right Coverage at the Right Price. Various policy terms are available — per-occurrence and aggregate policy limits, deductible waivers, defense inside the limits and defense outside the limits, plus endorsements for specific liability.
As a real estate professional, you work hard to provide quality services to your clients. PBI Group does the same to protect your firm and agents with the best coverage available in this ever-changing world.
When an agent or broker lists a property for sale, both they and their company are taking a risk. The same can be said for the business of buying, leasing, property management, and vacation rentals — every service a client benefits from comes with risk to your firm.
At least 90%+ of claims are filed on real estate agents by clients who are buyers or sellers. It is in your best interest to lower your liability by implementing risk management procedures to reduce the likelihood of an incident that could lead to a claim. Some of the most common mistakes that lead to a claim are related to the property for sale.
"Failure to advise" is the most common type of claim — a catch-all term for a sell-side agent not listing the property correctly, or for the buy-side agent not notifying the buyer of flaws, restrictions, or obligations that are subject to the property. A strong E&O policy will provide cover for the real estate company when a seller or buyer claims negligence has impacted the deal.
A few common claim patterns we've seen written against the brokerages we insure. For a more comprehensive list of claims worth learning about, visit our blog.
In the age of Airbnb and other home-sharing services, it's now easier — and more appealing — than ever for homeowners to rent out their property for additional income. But no homeowner should assume they can rent out their property with no strings attached, and no real estate agent should provide information to potential buyers that they cannot guarantee is factual. "Failure to advise" is the most common type of E&O claim filed against real estate agents.
In any real estate transaction, if a brokerage collects commissions from both sides of the transaction, there is a significantly higher risk of claims of wrongdoing — collusion, misrepresentation, or fraud. Whether or not the claim has merit is often immaterial to the legal defense costs; all a claimant has to do is file a lawsuit stating what they believe transpired.
Square footage, easements, sewer/water status, undisclosed flood or water damage, HOA restrictions, open-house incidents — listing details that turn out to be wrong are a common source of buyer-side claims, even when the brokerage was relying on the seller's disclosures in good faith.
All agents and brokers should have real estate E&O insurance, and most already do — most of all because it is required by a franchise, bank, or state licensing board.
Some states encourage their brokers and agents to purchase their own insurance via a state-sponsored portal, where they can obtain an online quote in just a few minutes. These policies can be convenient to buy, but they are extremely rudimentary and are best suited for small agencies with fewer than 10 agents. When your business grows beyond 10 agents, PBI Group recommends a firm-wide E&O policy that provides broader protection without gaps in coverage between individual agents and the brokerage.
Individual real estate E&O policies typically run $100–$500 per agent per year; firm-wide policies price off gross commission income, from around $750 for a new agency to over $100,000 annually for the largest brokerages. See the full breakdown — the six factors that drive premium and how individual vs. firm coverage compares — in our real estate E&O cost guide.
Errors and omissions insurance for real estate professionals requires an expert, trained insurance professional to guide you through the coverage selection process. At PBI Group, we have written over 50,000 real estate E&O policies for 3,000+ real estate companies throughout the 50 states since 2009. Many of these companies you know — they are your peers in your state or part of your franchise network.
PBI Group is founded on the principles of trust, partnership, fanatical service, and — most of all — one of the strongest E&O policies available. We do what we do because we believe there is a better way to buy professional liability insurance than online portals with cheap premiums and minimalist coverage.
PBI Group writes real estate E&O in all 50 states + DC. Pick your state for state-specific statutes, regulator data, and the carriers admitted in your jurisdiction.
Let PBI Group get you a quote — no fluff, no pressure, just a fair price for strong coverage.
