Required Real Estate Agency Business Insurance Coverage Explained
- 43 minutes ago
- 2 min read
Running a real estate brokerage comes with unique risks, from client disputes to property showings and sensitive data management. Understanding required real estate agency business insurance coverage is essential to protect your brokerage, agents, and clients from financial and legal exposure. Here’s a breakdown of the key insurance policies every real estate agency should consider.
Real Estate E&O (Errors & Omissions) Insurance
E&O insurance is the most critical coverage for any brokerage. It protects your agency and agents from claims of negligence, misrepresentation, or failure to disclose critical property information.
Whether a client alleges a misstatement on a property listing or a transaction error, E&O coverage provides financial protection for legal defense costs, settlements, and judgments. Many states also require E&O insurance for licensed agents and brokers.
General Liability Insurance for Agencies
General liability insurance protects your brokerage from third-party claims unrelated to professional advice. This includes:
Bodily injury during property showings
Property damage at your office
Slip-and-fall incidents
Even minor incidents can lead to costly lawsuits. General liability ensures that your brokerage can cover legal costs and maintain operations.
Commercial Property Insurance
Your office space, equipment, furniture, and signage represent significant investments. Commercial property insurance protects against:
Coverage ensures your brokerage can continue operations without financial disruption in the event of a loss.
Cyber Liability Insurance
In the digital age, real estate agencies handle large volumes of sensitive client data, including financial records and personal information. Cyber liability insurance protects against:
Data breaches
Hacking incidents
Ransomware attacks
This coverage helps your agency respond quickly to cyber threats while minimizing financial impact.
Workers’ Compensation Insurance
If your brokerage has employees, workers’ compensation insurance is typically required by state law. It covers medical expenses and lost wages for employees injured on the job, ensuring compliance and employee safety.
Why Proper Coverage Matters
Operating without the required insurance exposes your brokerage to lawsuits, regulatory fines, and potential business closure. Proper coverage ensures:
Compliance with licensing and regulatory requirements
Protection against client and third-party claims
Financial stability during legal or operational challenges
For tailored protection and a customized insurance plan, request a customized quote from Wexford Insurance. Our team specializes in real estate agency coverage and can help you select policies that match your brokerage’s size, operations, and risk exposure.