Real Estate Agent and Broker Insurance in Texas

E&O insurance covers legal defense costs when a real estate broker or agent is sued for negligence, such as a mistake in paperwork or failure to disclose known flooding risks at a property.

Also called professional liability insurance, this policy is required in some states for real estate professionals. However, Texas does not require E&O coverage.

Even though it's not required by state law, real estate agencies, brokerages, and client contracts will likely require you to carry an E&O policy. It's a key part of risk management for Realtors and other real estate professionals during a property transaction.

General liability insurance protects your business from expenses associated with common mishaps, such as customer bodily injuries and accidental property damage.

Real estate agents and brokers might need this coverage to sign a commercial lease or qualify for a business loan. Clients and agencies might also ask for proof of insurance. For additional coverage on your general liability insurance and other policies, you can buy commercial umbrella insurance.

A general liability policy also helps protect against advertising injuries, such as libel, slander, and copyright infringement. So, if an employee at your real estate agency defames a competitor on social media, this policy would cover your legal costs if the other business sues.

A business owner’s policy bundles general liability insurance with commercial property insurance at a discount, and protects against common lawsuits, fires, and water damage. If you don't have an office, consider adding a business personal property (BPP) endorsement to your general liability policy instead.

Unlike most states, Texas does not require businesses to carry workers’ compensation insurance. Most employers still choose to buy this coverage to protect against costly workplace accidents.

Workers' comp covers medical bills from work-related injuries and occupational diseases, and provides disability benefits for injured Texas workers. Most policies include employer's liability insurance, which shields employers from legal fees if an employee blames them for their injury.

This coverage is recommended for sole proprietors as well as employers, as personal health insurance can deny claims for injuries that are related to your job.

Commercial auto insurance protects vehicles owned by your real estate agency, such as a van used to transport home staging decorations to clients' homes. It can cover legal bills and other costs resulting from an auto accident. Depending on your policy, it may also cover vehicle theft, weather damage, and vandalism.

Texas requires auto liability insurance with limits of at least:

• $30,000 in bodily injury liability or death liability per person
• $60,000 in bodily injury liability or death liability per accident
• $25,000 in property damage per accident

Auto insurance policies sold in Texas automatically include personal injury protection (PIP), though it is possible to opt out.

For vehicles that your business uses but does not own, you'll need hired and non-owned auto insurance (HNOA). You can add it as an endorsement to your general liability policy or commercial auto policy. Keep in mind that if you drive your own car for work purposes beyond a commute, personal auto insurance won't provide financial protection.