FIND OUT HOW WE CAN HELP YOU
Common Real Estate Errors and Omissions Claims
Posted on: December 29, 2014 by NewMark
In our previous post titled “The Basics of Professional Liability for Real Estate Agents,” we explored some of the common legal problems you may run into during the course of your career. We emphasized that because of this, it’s imperative that you have the right comprehensive Real Estate Errors and Omissions (also called Professional Liability) insurance policies in place to financially protect yourself. Having this protection though is just the first step; understanding common real estate errors and omissions claims could help you to potentially reduce your risks and mitigate loss. The following are some common reasons for claims.
Environmental Liability. If for any reason you neglect to recommend a person of expertise for problems such as asbestos exposure, lead-based paint, or groundwater contamination, amongst other environmental issues, a client could certainly have a basis to sue. Know the common environmental issues and hazards in your area; doing so will limit this type of liability. It’s also wise to compile a list of local inspectors and resources to give your customers right away.
Unauthorized Practice of Law. 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. It’s important to be aware of the parameters of what you may and may not do in your state, and urge your customers to hire a lawyer if they have legal questions.
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.
It’s imperative as a real estate agent or broker that you be well equipped with the appropriate Real Estate Errors and Omissions Coverage. At NewMark, we understand that mistakes are bound to happen in the real estate industry- or in any industry for that matter- even by top talent with years of expertise. Our mission is to provide superior protection from financial loss to our client’s businesses, property and assets at affordable rates, as well as the best service experience in the industry. Please contact us at (855) 777-6549 for more information.