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Common Real Estate E&O Claims
Posted on: June 27, 2016 by Newmark Insurance
Real estate agents are no strangers to the legal threats that face them in their daily operations. Especially in such a litigious society, it’s becoming more and more common for lawsuits of all types to be brought against real estate professionals. Therefore, in addition to securing a comprehensive Real Estate E&O policy to provide the proper defense, understand the common reasons that claims come to be.
If you fail to recommend the proper professionals to examine or manage environmental threats such as asbestos, lead-based paint, groundwater contamination, and the like, you may be held liable for damages. Become familiar with any risks that may be associated with the property you are listing and get a list of local trusted inspectors to do the proper investigating. Ensuring the property is clean and safe is your liability as a real estate agent, so don’t let this fall by the wayside.
According to the REALTORS Code of Ethics, as a real estate agent or broker you are not allowed to provide legal guidance to your clients. All states allow for different practices, so ensure that you are not breaking regulations when giving advice to clients. If you are unsure, refer them to a lawyer.
Real Estate Settlement Procedures Act (RESPA).
Designed to inform homebuyers about the costs of closing and to eliminate kickbacks to settlement service providers for referrals, RESPA violations can be avoided if you understand the law’s prohibitions and maintain strict compliance. All agents should undergo thorough training to prevent any accidental and unintentional violations of such codes.
At NewMark Insurance Services, we specialize in writing insurance products for the real estate sector. Our comprehensive and competitive policies reflect an increasingly litigious society’s risk profile. To learn more about how to properly protect your firm, we invite you to contact our experts today at (855) 777-6549.