While it may be tempting to sweep problems under the rug, an effective realtor will be upfront and honest about all the aspects of a property he or she is selling. However, when something comes as a surprise to both the buyer and the seller, it is the agent that tends to be blamed. Real estate professional liability insurance coverage protects the mediator against legal costs.
There are a couple of basic reasons that people sue real estate agents: failure to make recommendations, such as inspections, and non-disclosure of property problems. While a home seller is legally responsible for telling a buyer if there are any problems with the structure of the home, or if there has been a problem with flooding, for example, not everyone is straightforward.
Oftentimes a seller seems to go off the grid after a sale, and an angry buyer either can’t find him or her, or the seller refuses to pay. Agents then take the brunt of that ire and desire for compensation. A realtor can cut down on potential liability by suggesting buyers purchase a home warranty.
Having real estate professional liability insurance can protect agents from legal costs when they are faced with court action. You can work with confidence when you have an errors and omission policy, because you’ll be protected if you are charged with a false claim.