Errors & Omissions in New Mexico
NM Real Estate E&O Requirements
Like 13 other states in the US, New Mexico requires that real estate agents and brokers purchase and maintain professional liability insurance, also known as errors & omissions (E&O) insurance. Other states that mandate real estate E&O include Colorado, Tennessee, and Louisiana. The New Mexico Real Estate Commission (NMREC) lets agents and real estate firms purchase errors and omissions coverage from the state’s group program or any private company that meets the E&O coverage requirements in NM.
Some NM real estate brokers and agents purchase an individual E&O policy, and real estate brokerages sometimes purchase an additional excess errors and omissions policy above the agent’s individual policies.
While this has worked for some agents, many New Mexico brokers who previously had individual agent coverage were pleasantly surprised to find that a single policy covering both the firm and the agents, brokers, and independent contracts doing business on behalf of the firm is often the best option. Firm policies can be competitive in price and provides much broader and stronger E&O coverage for both agents and the firm.
The New Mexico E&O Spectrum
Real estate E&O is a specialized insurance product that most insurance agents do not even fully understand. Many errors and omissions insurance policies in New Mexico have broad coverage exclusions. These gaps, lower limits, or exclusions can lead to denied claims for real estate brokers & agents.
For example, most E&O policies have coverage limitations for agent-owned property. If an agent sells or purchases residential or commercial property, land, or investment properties, many errors and omissions companies would deny a claim arising out of these transactions. A strong E&O policy will provide broad coverage for agent-owned transactions.
Additionally, most policies exclude claims for bodily injury or property damage. If an agent sells a property and is later sued for failure to disclose mold, any mold remediation costs would be excluded. That also goes for if a homebuyer gets sick from mold or lead and sues.
Other common E&O deficiencies include property management coverage limitations, little coverage for escrow claims, copyright or trademark violations, flips, or fair housing violations.
Get E&O Options from FirmSecured
At FirmSecured, we do not simply provide cheap E & O quotes. Instead, our team helps you understand your current coverage, any gaps or needs, and other options that might be more suitable for your firm. Our goal is to help you find the strongest E&O coverage for your firm at the most competitive price.
Whether you manage a large residential real estate agency in Santa Fe, specialize in commercial real estate outside of Albuquerque, or manage a property management firm in Las Cruces, we can help.
If you are ready to get started on E&O options, complete the form below to have a team member reach out shortly.
To bypass the form, or if you would rather schedule time directly on our calendar, book time on Google Meet here.
Ready to Get Started on New Mexico E&O Insurance?
FirmSecured is powered by Veritas Risk Management, an independent insurance agency in Northeast Tennessee.
Cyber Insurance - NM Real Estate Firms
The New Mexico Cyber Insurance Landscape is Changing Rapidly
Breach response costs, ransomware, and phishing are all common terms in the news. For real estate agencies, funds transfer liability, or 3rd party wire fraud, is a significant risk. When a real estate agent’s email is compromised, cyber criminals can view all of the communication surrounding a real estate transaction and closing. These hackers are sending emails to real estate agent’s clients, posing as the agent, with fraudulent wiring instructions. While this is not covered by E&O insurance, a solid cyber liability policy will kick in to pay these expenses. Find out more about cyber insurance for real estate agencies.
General Liability Insurance
Prefer to have 1 insurance agent for all of your liability insurance?
Most brokers prefer having one trusted insurance agent for all of their firm’s liability insurance needs. If you trust our team with cyber liability insurance and errors & omissions coverage, our team can assist with general liability options as well. We will help you review your general liability options to find the best option for your firm.
