As a policyholder, looking out for the best E&O insurance company out there can take a huge toll on you since most of the insurers don’t always keep to their promises. We are here to help you get the best insurance carriers and RISC insurance is one of those companies.
However, understanding what this company offers and how important the reviews are will help working with them better.
Further, in Alaska, Colorado, Iowa, Idaho, Kentucky, Louisiana, Mississippi, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, South Dakota, and Tennessee, this corporation provides real estate E&O insurance.
According to 13 reviews on google, the RISC insurance has a 3.7 star rating out of 5 stars. These reviews will be presented in the later part of this article.
Keep reading to see everything this company has to offer.
About RISC Insurance
Since 1989, the RISC family and its associates have specialized in state-mandated real estate E&O programs. They offer group coverage in 13 of the 15 states that have them, and real estate licensees are required to obtain insurance.
Furthermore, they also provide an independent program in one of the states where it is required. Continental Casualty Company, a CNA insurance company rated A (Excellent) by A.M.Best.
CNA has over 50 years of experience in E&O programs, with over 30 years of experience in real estate E&O. CNA is the leading provider of real estate liability insurance. This company has over a century of expertise, industry understanding, and financial strength to handle even the most difficult situations.
What Coverage Option is Offered by RISC Insurance
This Company offers real estate E&O insurance, which will be explained below;
Real Estate E&O Insurance
Errors and omissions insurance (E&O) is a sort of professional liability insurance. It covers businesses, their employees, and other professionals from claims of poor work or carelessness.
The truth is, real estate agents and brokers frequently expect that every transaction will run well. Also they frequently expect that all of their buyers and sellers would be fair.
Regrettably, reality can rapidly disprove them. The curb attractiveness of a home may conceal structural issues on the inside. Lead paint, a failing septic system, a leaking roof, a termite infestation, a radon or asbestos problem… All of these things could be lying behind closed doors, waiting to sabotage the sale or cause legal wrangling afterwards.
Similarly, the people you work with may appear to be pleasant at first. However, if something goes wrong during the purchase, they may turn to you for financial assistance.
RISC insurance E&O
In Alaska, Colorado, Iowa, Idaho, Kentucky, Louisiana, Mississippi, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, South Dakota, Tennessee, and Wyoming, RISC provides real estate E&O insurance.
However, these states demand that real estate licensees carry E&O insurance. The insurance must meet specified criteria. The company provides coverage that goes above and beyond the bare minimum.
Continental Casualty Company, a CNA insurance company rated A (Excellent) by A.M.Best, is the insurance carrier for RISC’s programs.
If you have an active real estate license, all of the company’s basic policies are guaranteed-issue. So you won’t have to worry about qualifying for enrollment if you’ve had a claim.
There are other reasons to buy E&O insurance besides the fact that it is mandated by law in some areas. Licensees frequently believe that no claim will ever be filed against them.
Unfortunately, anyone can be the target of a frivolous lawsuit or make an honest error, regardless of their knowledge and years of experience.Even if they follow the rules or go above and above for their clients.
Even if a lawsuit is dropped, legal fees to defend the claim can easily run into the tens of thousands of dollars. One of the most important features of RISC insurance is defense cost coverage.
However, there is no ceiling on the amount of defense costs the insurance carrier will pay for insured claims under the basic policy limits.
For example, if defending a covered case costs $150,000 in legal fees, the insurance company would pay the fees. Also, the funds available to pay covered damages would not be reduced.
Note that in some areas, defense costs may be limited by sublimits (for claims not normally covered by E&O insurance). When an honest mistake in your real estate services results in a covered claim, the insurance carrier will pay covered damages. This will be in addition to defense expenses.
Benefits of using RISC Insurance
Below are some of the advantages of trusting RISC;
One of the most experienced Insurers
RISC manages every part of the program, ensuring simplicity and consistency. This happens from the moment you apply for coverage to the moment you file a claim. Other carriers may require you to contact many firms for various reasons, like acquiring coverage and filing claims.
Claims Adjusters focus on you when a claim is made
Even after you get coverage, you can be rest assured that they will be there for you. Some people believe that insurance firms are looking for excuses to refuse coverage. RISC’s top priority is to find coverage where the policy allows for it.
Most insurance companies have two entities: one that sells the coverage and another that handles the claims. Because we handle both, the policy information we provide represents how it will be applied in the case of a claim.
However, providers who do not handle claims may be unaware of how the carrier interprets the policy when a claim is filed.
Because the adjusters only deal with real estate and appraisal E&O claims, they’ve honed their skills in this area. They are also familiar with retaining experienced defense lawyers in all of the states where RISC provides coverage.
Even when a claim is made, there will be there
RISC, unlike some other carriers, will not cancel or refuse to renew your policy solely because you have a claim. Even the most cautious professional might make a genuine error or become the victim of a bogus claim.
Never assume it will not happen to you. If it does, they are here to assist you.
Common mistakes that can lead to Errors and Omissions claims against you
Below are mistakes that might lead to E&O claims against you;
- You’re selling a house that has a hidden physical or structural issue.
- You breach your fiduciary duty to a client (i.e., you do not act in the client’s best interests).
- In a listing, you describe a property improperly.
- You don’t disclose all of a property’s liens.
- You either accept a referral fee or violate the Real Estate Settlement Procedures Act (RESPA) or the rules of your state’s real estate board.
These are just a few ideas to get you started. In fact, there are a plethora of additional ways to become involved in a legal battle.
Consider the scenarios below;
A family with two asthmatic children decides to purchase a property. However, once they have settled in, they decide to conduct a radon test on their new home. The property, it turns out, has a lot of this radioactive gas.
They decide to sell the property at a loss of $50,000 because they are concerned about their young children’s health. As a result of their agent’s failure to disclose a major health risk, they sue for the same amount plus legal fees.
A retired government official decides to start a home daycare company. She does, however, live in a condominium with no outdoor space where her customers’ children can play throughout the day. She decides to purchase a larger home with a spacious yard so that her children can play securely under her supervision.
Also, she finds a property that meets her wants with the help of a local real estate agent. However, after purchasing it, she realizes that town zoning prohibits her from running a home daycare at that area.
Before she put down her money, the agent assured her that zoning would not be an issue. As a result, she sues the agency for $50,000 in damages because the house is no longer fit for her needs.
How does RISC insurance E&O work?
When you buy real estate E&O insurance, you’re agreeing to have an insurer pay for your losses. The insurer pays for your losses up to the policy limits as long as you pay your payments.
The insurer agrees to the following as part of this agreement:
- You will be provided with an attorney.
- Make a payment for your legal fees.
- Any court judgements should be covered.
- Set aside money for settlements with plaintiffs.
- Pay for court appearances, expert witness fees, and other administrative expenses.
Now, the insurer isn’t bound to compensate you for all of your losses under the terms of your policy. It has the power to exclude people who fit into certain categories, such as:
- Intentional actions of dishonesty, fraud, criminality, or malice, as well as those that knowingly violate any statute or law.
- Legal disputes involving class actions.
- Litigation that was settled or is underway at the time your e and o insurance was issued.
- Any person’s actual or alleged bodily injury, sickness, disease, emotional discomfort, mental torment, or death.
- Other events covered by your E&O insurance policy.
Despite the advantages of RICO insurance, some agents choose to forego this necessary protection. Those doing business in the dozen or so states that need E&O insurance must, of course, carry their own E&O insurance.
Those in the other states, on the other hand, frequently justify their lack of insurance in various ways. Consider the following scenario:
- They assert that they will never make a blunder.
- They believe that their clientele will always like them and that they will never be sued.
- Thirdly, they believe their property due diligence is exceptional, and they would never intentionally misrepresent a property’s condition.
- They believe that if a disagreement emerges, they will be able to achieve an acceptable out-of-court solution swiftly.
Of course, when you consider these reasons, it becomes clear that they are built on sand. Even the most seasoned real estate agent will occasionally overlook a flaw and misrepresent a home’s condition. Even agents with exceptional people skills may find themselves working with clients who are impossible to satisfy.
Finally, keep in mind that purchasing RISC insurance E&O isn’t simply about lowering the cost of being sued. It’s also about sending a positive word to local prospects about your company.
It’s critical to have your own E&O insurance if you want to be viewed as a professional, ethical real estate salesperson.
Also,It demonstrates to others that you are a true professional who stands by your efforts in both good and bad circumstances.
What is the RISC insurance Phone number?
You can reach the company via +1 502-897-1876
Where is this company’s location?
This Company is located at 4211 Norbourne Blvd, Louisville, KY 40207, United States.
What is a claims-made-and-reported policy?
Claims-made-and-reported policies apply to claims that are made and reported during the individual policy period. Unlike occurrence policies, under claims-made-and-reported policies, the applicable policy is determined by when the claim is first made, not when the subject transaction occurred.
What kinds of claims are not covered?
E&O policies do not provide coverage for all types of claims that may be made against real estate licensees. We urge you to review the entire sample policy for your state (available on your state’s webpage), including the Exclusions section.
How do I enroll online?
From the home page, click on “Enroll” or you can click “here” now. You can also select your state then click on Enroll or Renew.
Note that licensees in Kentucky, and Louisiana, and South Dakota may enroll in our program through their respective state real estate commissions when applying for or renewing their license