Why are agents required to carry individual E&O coverage?
Your state mandates that real estate licensees maintain E&O insurance coverage that meets specific state minimum requirements. This is a regulatory requirement, not a brokerage policy, and it applies regardless of brokerage affiliation. To help ensure compliance, most agents satisfy this requirement by enrolling in the state-approved and sponsored group E&O plan (RISC/CNA), which is designed in coordination with your state real estate commission to meet your state’s statutory requirements.
Will I still have to pay the CBR fee on transactions? And if so, why?
Yes. The CBR fee will be charged on each transaction. The CBR Fee is not an E&O insurance premium. It helps provide a number of brokerage services, including:
- Broker supervision and transaction review
- Regulatory compliance oversight
- Risk management and file auditing
- Processing and operational support for each transaction
While the CBR fee supports compliance and risk mitigation, it does not replace the state-required E&O insurance, which provides financial protection for claims defense and indemnity.
Whose E&O insurance is primary if there is a claim filed?
An agent’s individual errors and omissions (E&O) policy, that policy will, if covered, provide primary coverage for the agent. Real’s E&O policy may, if covered, provide excess coverage.
What is the difference in policies?
Certain states legislatively require that agents carry errors and omissions (E&O) insurance that carry specific terms, such as a limit on the deductible. Real’s E&O policy provides coverage to all affiliated agents of Real with terms which typically do not comply with legislative requirements for E&O coverage for agents.
Agents can find a list of requirements under: Additional Required E&O Insurance
Will I be reimbursed for the added E&O policy from RISC or other equivalent coverage?
No. Agents working in states that require state-specific errors and omissions (E&O) insurance coverage will be responsible for obtaining and paying for that policy.
How would I show proof to the State that I purchased my own E&O policy?
RISC Insurance typically will provide the state a list of those individuals who have purchased policies. Other equivalent coverage may need to be submitted to the state directly.
Real requires agents in applicable states to submit their E&O Certificate of Insurance to Real. Our knowledge base article Submitting Your E&O Certificate of Insurance (COI) provides steps and best practices for submitting your COI to Real.
Where do I go to purchase an individual E&O policy?
Please see our knowledge base article Additional Required E&O Insurance for requirements, the links to RISC, and your state’s E&O resources page.
What are the procedures for reporting an E&O claim?
- Notify your primary E&O carrier (i.e. Rice or CRES)
- Notify your Real State Broker. Please see Broker Contact Information for your state broker’s email address.
Next Steps
If you have not already done so:
- Obtain an individual E&O policy that meets your state requirements (state group plan or approved equivalent)
- Ensure Real Broker, LLC is listed as the certificate holder
- Submit your Certificate of Insurance (COI) through this link
If you have questions, please visit this Knowledge Base article for detailed guidance