What Losses Can Real Estate Liability Insurance Help Cover?

Most real estate professionals make every effort to find the properties that are best for their clients. Unfortunately, it is not uncommon for agents and brokers to make mistakes or for clients to think that such mistakes have occurred. Fortunately, real estate liability insurance can offer protection in both of these situations by covering the following losses.

Legal Defense Costs

Any professional liability claim, regardless of its validity, can result in costly legal expenses. Proving that a claim is unsubstantiated can be financially devastating for many professionals. Besides hiring an attorney, these professionals may need to pay various fees and hire witnesses to testify in their defense. Real estate liability insurance can pay for these necessary costs, up to a set policy limit, once an insured agent or broker has paid the policy deductible.


If an agent or broker is ultimately found liable, liability insurance can cover the cost of the damages that are awarded. Coverage may not be available if an agent or broker knowingly engaged in inappropriate practices. However, if an agent or broker’s error or oversight was unwitting, insurance coverage can protect the agent or broker from losing personal assets.

Finding Full Protection

Real estate liability insurance offers essential protection in the event of professional liability claims, but it cannot address every risk. For instance, property damage and bodily injury are usually covered instead under a general liability policy. It is always important for real estate agents and brokers to understand these restrictions and work with an insurance agent to determine whether any additional coverage is needed.

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