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Monday, 09 December 2019
Agent Resource Center
Agent Resource Center

What do you need to Know about General Liability Insurance and Professional Liability Insurance?

Written by Posted On Monday, 02 December 2019 00:26

Introduction

At present, lawsuits against real estate professionals are quite common. They often occurred due to alleged failures to negligent misrepresentations, defects disclosures, missed disclaimers, and other issues arise during the property sale process. While you can pay careful attention, the legal risk will still risk in your real estate business. 

As a real estate agent, you may face claims that can ruin your years’ efforts and hard work. Therefore, you must practice due diligence to protect your firm and yourself. Fortunately, real estate insurance may help cover potential risks related to your profession. Here is all that you need to know about general liability insurance and professional liability insurance. 

What is General Liability Insurance?

General liability insurance covers customer property damage, personal injuries, and other related lawsuits. Real estate agents usually need this type of insurance for the coverage of losses that occurred in commercial property contracts and leases. 

Note that general liability insurance will protect you against common risks associated with your profession. This policy assures your customers that you can cover the expenses in the event of third party physical injuries or property damage. General liability insurance covers:

  • Advertising injuries
  • Third party property loss or damage
  • Third party physical injuries

Advertising injuries include coverage for copyright or brand infringement and defamation. By property loss or damage, it means this policy will give coverage for the client’s property damage, including that repair cost or item replacement. 

For instance, if you break an expensive painting during the showing, general liability insurance will cover the cost of the asset loss. Physical injuries, on the other hand, cover medical bills, funeral expenses, settlements, court-ordered judgments, and attorney’s fees.

What is Professional Liability Insurance?

Known also as errors and omissions (E&O) insurance, the professional liability insurance protects real estate businesses against lawsuits that clients brought by claiming the services were late, inaccurate, or never delivered. This insurance protects realtors against professional mistakes.

In other words, the oversight in a property listing or error on a title could result in a lawsuit. Whether you have made a genuine mistake or the litigious client sued you falsely, professional liability insurance can help cover legal fees that can affect your business. Error and omission insurance provides liability coverage to:

  • Accusations of negligence
  • Failure to deliver promised services
  • Professional mistakes

In essence, professional liability insurance provides you with critical protection against lawsuits related to your real estate business. 

The Bottom Line

The general liability insurance and professional liability insurance that cover professional services and the later mentioned policy protects real estate agents from third party property damage and physical injury claims. In essence, both of insurance policies are essential for real estate agents to protect their businesses. Check out BizInsure’s website to learn more about insurance for real estate agents. 

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