A Seller’s Protection Plan (also called Seller’s E&O) covers your client with up to $25,000 to pay for attorney’s fees and/or damages in the event of a claim from a buyer. It also helps protect you, by reducing the risk that your uninsured seller will turn around and sue you if they are sued by the buyer. The plan covers your client up to 180 days from the close of escrow and can be extended an additional 180 days for an additional fee . But beyond the coverage it provides, what else does Seller’s Protection Plan do for you?
Get More Listings with this Competitive Advantage
A Seller’s E&O Protection Plan can be exactly what will motivate a potential seller to give you the listing. Few, if any, other agents will offer Seller’s E&O in their listing presentation — so it can set you apart.
With CRES E&O + ClaimPrevent®, Seller’s E&O may already be included in your policy. (In other states, it can be added for a minimal cost, usually $5.)
When offering Seller’s E&O gets you just one additional listing, your commission from that single additional listing will pay for your real estate E&O for the entire year!
Seller’s E&O Protection Plan shows that you care about what happens to your clients even after the sale has taken place. Clients who may have concerns about the property they are selling can be mollified knowing that there is $25,000 of protection should a buyer file a claim. Without it, your sellers would be left on their own to pay attorney’s fees and damages.
Be a Hero: Referrals
No one wants a claim against your seller to happen, but should one arise, having coverage makes you look like the hero. If a claim does happen and the sellers are happy with the E&O coverage you brought to them, they may be more likely to refer you to a family or friend.
One agent recounts one such incident:
“A long-time friend of mine, Rick, was looking for a realtor and I agreed to come look at the property and act as the listing agent.
When I arrived, he and his wife were so proud to show me all of the upgrades they had done to the home. In just four years, they had installed a hot tub, built a shed, put in three ponds, added a gas fireplace, and completely renovated the kitchen. I knew they were proud of the work because they had done almost all of it themselves, so I tried to tread lightly.
Rick and his wife weren’t professionals, and what I saw was one potential claim after the other. I told them about my Seller’s Protection Plan and a home warranty, but they didn’t think either was necessary.
In the end, Rick decided to sell the house himself. Sure enough, within six months, three appliances had failed, a flood occurred in that new kitchen, and electrical work had to be replaced. The new owners, who sought more than $5,000 in compensation, sued Rick and his wife.
When it came time for their son to sell his home, Rick insisted that he work with me — because he felt his son and daughter-in-law would be better protected under a Seller’s Protection Plan.”
A Seller’s E&O Protection Plan does more than provide protection. It shows that you care about your clients and that you are ready for whatever may happen.
This blog/website is made available by CRES Insurance Services for educational purposes to give you general information and understanding of legal risks and insurance options, not to provide specific legal advice. This blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state. Claims examples are for illustrative purposes only. Read your policy for a complete description of what is covered and excluded.
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