Module 19: E&O for Real Estate Professionals

This module outlines the historical development of errors & omissions coverage for real estate professionals, their job functions, and types of services covered by these policies. It explains federal and state regulations governing the profession, education, training and licensing, and professional standards that apply to real estate professionals. The concept of “agency” is important in real estate, so the module explains the different types of agency relationships and the characteristics of non-agency and “transactional” broker relationships.

Common law duties, statutory duties, the impact of material disclosure laws, and the various types of liability facing real estate professionals follow. Key provisions of policies, as well as optional endorsements and coverages, are highlighted. The module outlines typical types of claims, the claims management process, and developing claims trends. The risk management unit focuses on how risk management practices can help real estate agents and brokers manage errors and omissions risks by analyzing loss scenarios and determining appropriate techniques to manage their specific risks. The module reviews the current real estate professionals market and analyzes factors in underwriting and pricing this line of business.