Real Estate Agents Claim Examples
Bodily Injury and Property Damage Coverage
While holding an open house, a guest trips and falls sustaining a back injury. As the injury results in surgery and the guest cannot return to work, he brings a claim against both the homeowner and you, alleging improper lighting and failure to warn. ManyReal Estate E&O Insurance policies provide liability coverage for any negligence of the insured, the broker, and/or your agent, up to the full limits of the policy, less any deductible, in your capacity as a real estate agent or broker.
Pollution, Fungi, Bacteria
You were the seller’s agent. Prior to the sale of the property, you received a call from a neighbor complaining that a waste dump on the subject property was damaging their property. Although you provided this information to the buyer’s agent, the buyer alleges they never received this information prior to closing. The buyer brings a claim against you for failing to advise them of the waste dump. Many Real Estate E&O Insurance policies provides coverage for failing to advise of the existence of pollutants, fungi, or bacteria in your capacity as a real estate agent or broker.
Your listing agent made a $5,000 error in the Estimated Proceeds Worksheet given to the seller. Although the error was only in the estimate given to the seller, the seller is convinced he’s losing money and threatens to back out unless the buyer agrees to a $5,000 increase in the purchase price. The buyer has already sold their existing home and faces additional living expenses if the transaction fails to close on time. Both sides retain counsel who maintain that their position is legally correct. You notify your carrier of the situation and request assistance. The costs and fees incurred at the direction of some insurance carrier’s claim departments are covered under your Real Estate E&O Insurance policy, and your deductible is not implicated nor are the coverage limits affected for any dollars spent on this pre-claim assistance.
Automatic Acquisitions Coverage
You purchase another real estate agency, acquiring some of their employees and independent contractor agents. During the busy acquisition process, you forget to timely advise your insurance agent of the acquisition. During this time, one of the newly acquired agents represents a buyer in the purchase of property. 90 days after the acquisition, and before the ending date of the policy year, you receive a letter from the buyer alleging that the agent failed to advise them of the need to obtain a separate septic inspection which would have discovered temporary repairs to the septic. The buyer alleges he is unable to occupy the property as the property is too small to accommodate replacement of the septic system.