What If A Realtor or Buyer Is Injured at Your Listing? Can The Listing Agent Be Held Liable?

By
Real Estate Agent with Keller Williams Realty Louisville East (502) 664-7827

Scenario: (a) You have a listing, (b) A buyer or the buyer’s Realtor gets injured on the premises, (c) The seller, your client, is uninsured or under-insured, (d) NOW WHAT?

Can this happen? Yes!

There is no shortage of hazards; Snow or ice on steps or walkways, cracks in sidewalks, groundhog holes in the backyard, and many more. My city of Louisville KY has plenty of all of the above.

Of course, the first thoughts are sadness and dismay that someone got injured and is in pain.

Then some other alarming questions come to mind.

  • Will your client’s homeowner insurance cover the defense and the damages? Maybe
  • Does your client have a homeowner’s policy that is paid up and current?
  • Does your client’s homeowner’s insurance have enough coverage to pay for medical and other damages?
  • If the house is vacant, was your client’s insurance invalidated because they didn’t change the occupancy status with their carrier?

And then, more questions that may be too late to ask - ABOUT YOURSELF:

  • Can the listing agent be held liable? Yes, No, Maybe, To Be Determined, All of The Above, Who Knows? The personal injury lawyer will remember that you authorized the showing of the "hazardous" house.
  • Does your E&O insurance cover you?
  • Does your broker have any insurance to cover you?
  • Do you have ANY TYPE of liability insurance that covers you? To what extent?

When is the best time to get answers to these questions? NOW!

Find out and be prepared today. Don't wait until you get the dreaded phone call and it's too late.

Call your broker, today.

If you are the broker, ask other veteran and friendly brokers what they do.

Call your insurance agent, today.

Call a trusted attorney, today.

Please share your knowledge and experience with your Activerain friends by commenting here. If there is an insurance group here on AR, please let us know so we can read related posts.

Real estate is a great profession, we get to help wonderful people with major life decisions. But there are also some administrative and business issues that we must put in place and insurance is one of them.

Have a great day and let’s stay safe!

This post was inspired by Patricia Kennedy's post Have You Hugged Your Snow Shovel Today?

 

Posted by

 

 

Dave Halpern, Realtor

The Dave Halpern Real Estate Group

Keller Williams Realty Louisville East

Website David.DavidHalpernRealtor.com

(502) 664-7827

 

 

View Dave Halpern's profile on LinkedIndave_halpern twitterhalperndave_facebookDave Halpern QR CodeLouisville Foreclosure Realtors Dave Halpern

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Dennis Duvernay Broker/Owner 01/22/2011 11:58 PM
  2. Bill Burchard 01/24/2011 07:48 AM
Topic:
Home Selling
Location:
Kentucky Jefferson County Louisville
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Tags:
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Rainmaker
1,561,863
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

Good points about keeping everything current.  There is something called "contributory negligence" and that puts the burden onto the person claiming injury.  If they walked on the porch, and it was covered with snow, and tripped because there was something underneath they didn't see -- hmmmm . . . they took a risk, and contributed.  Just because someone is injured, doesn't mean it's  the home owners, brokers, etc. fault.  And if this was so prevelant, can you imagine how nearly impossible it would be to conduct our business?? 

Jan 23, 2011 07:08 AM #41
Rainmaker
266,354
Dora & Vincent Kwok
HomeSmart Real Estate - Chandler, AZ
CNE - Chandler, Arizona Real Estate

Hi Dave,

You bring up a topic with lots of interest.  We have our own business insurance policy, but it would be interesting to understand the liability for the Broker, listing agent, and buyer's agent too.

Jan 23, 2011 08:15 AM #42
Rainmaker
61,098
Susan Hamblen
Exit Realty Achieve - Smithtown, NY
Making the world a happier place...one client, one

It is a good idea to have a policy in place. We are dealing with snowy stairs and sidewalks and it is scary.

Jan 23, 2011 08:45 AM #43
Rainer
3,665
Michelle Brient
Commercial Insurance Pros - Irvine, CA

Wow, I am glad that you brought this up and so many of you are taking interest in it.

As real estate agents you should have a number of insurance coverage's in place;

1. General Liability-Business Liability Insurance Package Policy. Often referred to as a Business Owner Policy or "BOP," this General Liability package policy protects your company in the event a client is injured on your premises, or if you or one of your employees causes an injury or property damage at a client's location. You can usually add your vehicle to this policy.

2. Commercial Auto Insurance

3. Workers Compensation-Required in many states, Workers' Compensation Insurance provides medical and disability coverage for company employees in the event of a work-related illness or injury.

4. E & O

5. Employment Practices Liability Insurance. EPLI insurance provides the protection you need should one of your employees allege any number of employment practice violations. These violations include age, race or gender discrimination, wrongful termination and sexual harassment. EPLI is essential coverage in today's litigious workplace.

As Nona from Swan and associates stated, you should also have an Umbrella Policy- Umbrella or "Excess Liability" Insurance provides you with an extra layer of protection in the event you have large or multiple claims that exceed your General Liability, Commercial Auto or Employment Practices Liability policies.

I must disclose that all states are different, and all policies are different. So I would verify your coverage with your insurance agent. And also consider the coverages from above that you dont currently carry. I hope that addresses some of your concerns.

Michelle-commercialinsurancepros.com

Jan 23, 2011 08:56 AM #44
Rainer
14,407
Adam Aguilar
Adam Aguilar (Reliantra-Reliant Realty & Associates) - Toluca Lake, CA
Reliantra.com/Reliant, Realty~Serving Southern California

Just last week a Realtor had a slip and near fall while showing my listing. It was a rainy day and the front patio had tile floor. As she was closing the front door to leave she slipped. The buyer saved all of us by catching her as she started to fall. I thought to myself either the Realtor could have been injured or the buyer as well from trying to break her fall.

The following day, same listing, a different Realtor arrives limping and in obvious pain with her buyers. At the previous showed listing she slipped and fell. She was in so much pain she could not walk to present the home to the buyers and just sat while they walked the home.

Those events made the seller and I contemplate how it may had affected us. I did some research and found my E&O insurance does not cover this type of liability. It was recommended to me to seek General Liabilty coverage. Worker's Compensation may cover the Realtor (if the brokerage has them covered), but what about the buyers?

I found that General Liabilty coverage was actually cheaper than what I paid for in E&O. Better safe than sorry.

Jan 23, 2011 09:04 AM #45
Rainer
163,364
Ryan Case
SCA Real Estate - Anaheim, CA
877-828-0710

I would talk to a Real Estate attorney to get the correct answer to that question!

Jan 23, 2011 10:39 AM #46
Rainmaker
416,462
Tni LeBlanc, Realtor®, J.D.
Mint Properties, Lic. #01871795 - Santa Maria, CA
Tenacious Tni (805) 878-9879

Good information.  Although insurance companies will always find a reason not to cover a claim.  Most homeowner policies have only a small amount of coverage for medical care for this type of injury.  It is important to know where you stand up front.

Jan 23, 2011 10:49 AM #47
Rainer
451,625
Nancy Timberlake
RE/MAX Shoreline - Portland, ME
REALTOR - Southern Maine

OMG~~one more thing to worry about!!

Jan 23, 2011 11:10 AM #48
Rainmaker
262,382
Dawn Crawley
Dawn Crawley Realty - Pinehurst, NC
Find Pinehurst Homes

Well you really struck a cord with this one. I had a lady fall flat on her face one day after tripping over a step. It was my listing and worried for months something was going to come of this. Thank goodness it didn't.

Jan 23, 2011 11:39 AM #49
Ambassador
2,011,382
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

This sounds like something that's worth looking into ahead of time to minimize issues.

Jan 23, 2011 03:14 PM #51
Rainer
152,258
Anna Tolstoy
Coldwell Banker Residential Brokerage - Natick, MA

Dave, very important info, that gets overlooked. Excellent reminder - especially with snow, ice and Icicles here in MA.

Jan 23, 2011 03:57 PM #52
Rainer
145,395
Jeanne Kozak
RE/MAX In Action - Martinsburg, WV
REALTOR and Broker/Owner in WV and VA

With so many foreclosures, lots with no power on, we should be very careful showing homes with a flashlight in hand.  I would think the liability could fall right into our laps.

Jan 23, 2011 04:14 PM #53
Rainmaker
504,201
Lora "Leah" Stern 914-772-4528
Coldwell Banker, 170 N Main Street, New City NY 10956 - New City, NY
Real Estate Salesperson

David, You've opened a bag of worms.  Lots of different scenarios here and lots of differnet opinion and solutions offered.  Now, to determine the correct solution .... that's the trick.

Jan 23, 2011 04:18 PM #54
Rainmaker
73,662
Glen Fisher
National Property Inspections of Southern New Jersey, LLC - Oaklyn, NJ

Great post!!!  As a home inspector, I have entered countless homes with pre-existing hazards with no warnings posted.  And yes I have been injured several times, but have never made a claim.

The seller and listing agent should take a hard look at the property and remedy the hazards or provide warnings where appropriate.  

Jan 23, 2011 10:32 PM #55
Rainmaker
104,220
Robert Slick
Beach and River Homes - Georgetown, SC
NRBA, RDCPro, Trident/CCAR MLS

Think about it, a commercial liability policy runs about $300 for the year. That's good insurance against litigious buyers.

Jan 24, 2011 03:19 AM #56
Rainer
3,665
Michelle Brient
Commercial Insurance Pros - Irvine, CA

Hi Everyone,

I am so glad Dave brought up the issue of insurance in his recent post. It is a very important issue that some people either arent aware of or overlook. If anyone in California needs a quote or would like me to review your current policy, please feel free to call or email me.

Have a great day,

Michelle Brient

Jan 24, 2011 04:27 AM #57
Rainmaker
1,425,724
Bill Burchard
3B Realty: 951-347-3818, CA - Murrieta, CA
Broker, Realtor, Representing Buyers and Sellers

Hi Dave. Excellent topic! And these scenarios are all possible. Best to ensure you’re insured.

Jan 24, 2011 07:42 AM #58
Ambassador
536,877
Pam Dent
Gayle Harvey Real Estate, Inc. - Charlottesville, VA
REALTOR® - Charlottesville Virginia Homes / Horse

Dave - Good post and timely this time of year.  Next time I am showing property on a snowy day I'll worry.

Jan 24, 2011 01:53 PM #59
Rainer
478,183
Not a real person
San Diego, CA

Anytime you are on someone else’s property, there are things that can go wrong and create havoc in one’s life. Unfortunately, there are so many things that can go wrong that we don’t think of all of them and be proactive in addressing them.

Jan 26, 2011 01:10 PM #60
Anonymous
Shirley Walker

We just had an incident where a Buyer's Agent was showing a listing (REO) and the buyer walked into a dark closet and fell into the crawl space access (cover had been removed).  $29,000 in medical bills and another $120,00 for pain and suffering - E & O doesn't cover it.  Listing agent doesn't want to turn it in on REO Liability Insurance - they are blaming the agent that was showing the home - saying it's his fault.  Better make sure you have a liability policy in place.....

May 27, 2011 01:58 PM #61
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