Whether you’re a real estate agent or a real estate investor , the real estate industry can be a gateway to a huge amount of profit, but it can also expose you to a lot more risk than most other industries. This risk is typically financial, since there’s a relatively high chance of getting sued if something goes wrong.
Errors and omissions insurance real estate policies are going to be the focus of today’s article. We’re going to focus on what an E&O insurance real estate policy can do for you and your business and we’ll also look at the average real estate E&O insurance cost that professionals can expect to pay for coverage. Finally, we’ll explore some of the best real estate E&O insurance companies.
E and O insurance real estate policies are relatively common amongst real estate agents and investors. In fact, these policies are required by agents in nearly 15 states, so many of them don’t have a choice but to start paying for errors and omissions insurance for real estate agents.
Realtor errors and omissions insurance applies when you make a mistake while you’re dealing with a customer. If your negligence ends up causing damages to a client, then your E&O insurance policy will kick in and pay for the damages as well as any legal fees that resulted from the situation.
You’ll also have to consider the way you pay for your E&O insurance for real estate agents, since different companies have different billing methods. Cheap E&O insurance for real estate agents is usually sold per transaction instead of per month, ensuring that you only pay when you actually need the coverage.
This makes the most sense for real estate agents who are trying to save as much money as possible because you won’t need E&O coverage if you’re not making any deals. Another advantage to paying for E&O Insurance per transaction real estate is that there are limits per year, usually capped out at between $400 and $600.
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When considering the errors and omissions cost real estate policies, there are a few different factors that you and insurance carriers will have to account for. The most significant thing that will impact the cost of your E&O insurance is the number of transactions that you complete over the course of a year.
Real estate E & O insurance gets more expensive with each transaction because every one of them increases the chance of the insurance company having to pay out on your behalf. Since your insurance premiums are directly correlated with the risk of the insurer, higher risk usually means higher premiums.
Company | Cost per month | Cost per year |
---|---|---|
eXp Realty | $85* | $1020** |
Rice Insurance | $56 | $672 |
Keller Williams | $33 | $396 |
Real estate appraiser E&O insurance is usually a little more affordable than E&O coverage for real estate agents, though once again, the cost of insurance will vary from person to person. The factors we mentioned above will also apply in these cases.
Real estate E&O insurance is available from a wide range of companies, and selecting the right one will ensure that you pay the best possible E&O insurance cost real estate. The right company will also ensure that you get quality customer service, which is essential when your business might be on the line.
RISC (Rice Insurance Services Center) is a company that specializes in mandated E&O insurance for real estate professionals. This means that the company only operates in states that require real estate agents to maintain an E&O policy so that they can legally practice.
Rice Insurance Policy Details
The Rice E&O policy is underwritten by Continental Casualty Company and it covers legal fees and damages related to mistakes and negligence on the part of the real estate professional. Keep in mind that Rice’s policies vary based on the state that you’re getting insured in since every state has different guidelines.
Pros:
Available in most states where E&O is required
Relatively affordable
Covers legal fees and damages
Cons:
Underwritten policies
Average cost: $56 per month
Best for: Smaller businesses
Our Rating: 4.5/5
eXp Realty works with residential real estate agents, and while they may not be an insurance carrier, they have underwritten E&O policies for all agents that are their members. One of the most notable things about eXp is that they aren’t afraid to embrace progress, taking advantage of the internet far more than their competitors.
eXp Realty Policy Details
eXp Realty offers the same rate for E&O coverage to all of their members, though you’ll also have to pay for the additional cost of membership. One thing to consider about eXp’s policies is that your rates are based on the number of transactions you undertake every year, with a maximum cost of $500 per year.
Pros:
Low price
Maximum limit of $500 per year
Additional benefits to membership
Cons:
You have to pay extra for membership
Average cost: $40 per transaction
Best for: Agents making fewer transactions
Our Rating: 4.3/5
Keller Williams is one of the largest real estate companies in the world, and they’ve been in business since 1983. Even though they’re not an insurance carrier themselves, Keller Williams has a partnership with Austin and Austin Insurance Services so that they can provide their members with E&O coverage.
Keller Williams Policy Details
Keller Williams has a specific real estate E&O insurance policy for their members, and they’re a little more transparent with what you get out of it than eXp or Rice. For example, the Keller Williams policy features a $2 million limit per occurrence and aggregate, though legal fees are split 80/20.
Pros:
$2 million limit
Good price
Applies to commercial sales too
Cons:
Doesn’t cover all legal fees
Average cost: $33 per month
Best for: Commercial real estate agents
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John Murphy Insuranker
Policy Type: Business Insurance
Company name: Berkshire Hathaway GUARD Insurance Companies
Worst insurance comapny I have ever dealt with. A commercial vehicle represented by GUARD t boned my wife and daughters family vehicle in the middle of the day. Driver was cited and insurance claim insued. Fast forward 4 months and refusal of full amount of claim is still happening. Driver was found guilty, repairs started on my vehicle and when it comes to the final bill and diminished value we cannot get any help. I am out a family car, have an injured and traumatized wife and children, and now have to get legal and BBB involved for a company to do the RIGHT thing. Scott Lewis, Kevin Ware, Heather White, and Ryan P, lied about communcation on my claim, demonstrated Bias by overpromising and under delivering . They refused to pay the full amount owed and have associates untrained in vehicle condition assessment and reconditioning. Also, not one GUARD insurance representative has contacted my wife (the injured party) in 4 months to follow up on medical treatment. STAY AWAY IF YOU ARE SHOPPING INSURANCE!
Kasey Arey Insuranker
Policy Type: Business Insurance
Company name: Berkshire Hathaway GUARD Insurance Companies
This company gives you a price that was in place for a year and when you have to use it there is fine print were they can go back and charge you more. Would not recommend them to any one. Crooks
Insuranker
Policy Type: Business Insurance
Company name: Berkshire Hathaway GUARD Insurance Companies
Had general liability and workers comp with amguard. Paid high premiums and yet still got audited every year and had to pay more. Was able to prove less risk the first two audits and disputed price down but none the less had to pay more just so I could renew coverage. Third time the audit ( based on what I paid my premium on ) was ridiculous and tried to prove that there was no increase in risk from what I paid for my premium. However they would not believe it and required I paid full audit amount in order to have redline removed. Basically you do what they say and pay whatever outlandish bill they come up with or they will make sure you can’t run your business anymore. ????
Felicia Broadus Insuranker
Policy Type: Business Insurance
Company name: Berkshire Hathaway GUARD Insurance Companies
Avoid these SCAM ARTISTS! They don’t pay claims!!! Save yourself the trouble and money!
Felicia Broadus Insuranker
Policy Type: Business Insurance
Company name: Berkshire Hathaway GUARD Insurance Companies
They are the worst, my truck was hit in January 23 and the claim adjuster has not been out to this very day! They have every excuse in the book as to why. They have not been to the collision shop. PLEASE AVOID THESE SCAM ARTIST!