Are you adequately protected from the risk of being sued while providing real estate services? The Real Estate Errors and Omissions (E&O) Insurance Corporation, which provides mandatory insurance coverage for all real estate licensees, reported that there were 267 claims against licensees in the financial year ending March 31, 2020.
While that may not sound like a lot of claims, the total liability cost was $25.3 million, meaning the average liability per claim was just under $95,000. Imagine being caught up in one of those claims without having adequate insurance. You could be personally on the hook for close to six figures.
The value of insurance is it can reduce your personal exposure to liability while performing your duties as a REALTOR®. However, certain activities have limited or no coverage under E&O insurance. For example, property damage to a third party is capped at $100,000 and bodily injury to a third party is not covered at all. On top of those gaps, E&O insurance does not provide any coverage for the following:
- When licensees buy or sell their own property
- Fraud and/or intentional acts
- Real Estate Council of BC complaints
- Commission disputes
With that in mind, if you have not done so already, it may be a good time to explore options for additional insurance coverage to supplement your E&O insurance.
Which options are best for you?
This will depend on the nature of your individual practice because exposure can vary based on things like frequency of work and the types of property that you handle. The length of time that you have been a licensed Realtor may also come into play.
For advice on excess insurance options your best bet is to contact your insurance broker. If you do not have an insurance broker, E&O lists the following as possible excess insurance providers:
| Johnston Meier Insurance Agencies Group | 250-545-5311 (contact: Keith Breitkreutz) |
| Metrix Professional Insurance Brokers | 604-682-2680 (contact: Rob McLeod) |
| Peake & Richmond Ltd. | 604-922-0181 (contact: Jim Richmond) |
| Jardine Lloyd Thompson Canada Inc. | 604-484-5303 (contact: Sue Schurer) |
| ToolePeet Insurance | 403-209-5447 (contact: Adam Thomson) |
| Hub International Insurance Brokers | 604-269-1888 (contact: Jordan Fellner) |
*The above list is only to assist licensees who are interested in purchasing excess insurance. As stated by the Real Estate E&O Insurance Corporation, the list is not exhaustive nor is it an endorsement of any insurance broker.
Source: Professional Standards