E&O is the insurance that covers you in the event a client holds you responsible for services you provided or failed to provide in a real estate transaction that did not have the expected or intended result and your client sustains financial damages.
All business activities have risk associated with it. These risks do not go away simply by ignoring them. The best way to address the risk is through the implementation of a comprehensive risk management program. Education is critical in reducing a licensees risk of a claim. However when the best of risk reduction efforts fail, E&O is the vehicle in which you shift the cost of the claim or lawsuit to a carrier… E&O is vital to the firm and agent in that it is your ultimate safety net and protects your ASSETS.
All too often the decision to select E&O Insurance is driven by cost alone (the less expensive the better) and no consideration is given to the coverage under the policy. When price becomes the primary focus of purchasing a policy, you may be overlooking important coverage. There is a misconception that if you have E&O you are fully covered for everything you do. This is simply incorrect. DISPEL THE E&O MYTH.