Do Real Estate Agents Need Insurance?
Do Real Estate Agents Need Insurance? Armando is a Real Estate broker and was having a conversation with a client and the Title Company about the closing of a transaction to purchase a property valued at $ 600,000.
After four months of searches, offers, and counteroffers, they were finally closing.
But not everything happened as Armando thought, some hackers inserted themselves into the conversation through his email and created a bypass between the three parties. Every piece of information in that chat first passed through the hands of hackers. So when they sent the actual closing documents and instructions for the money transfer, the hackers simply changed the destination bank account.
The client carefully read all the information received, reviewed some details with the Realtor, and sent the money.
Three days later, the Title Company telephoned the buyer to warn him that “if he wanted to close on the appointed date, he should hurry up with the funds.” To which the customer responded very surprised that he had already transferred the $ 520,000 to the indicated Wells Fargo account.
At that moment the alarms went off since the account of the Securities Company was in Bank of America.
Upon learning of the deception, the client had to be admitted after suffering a myocardial infarction and his desperate wife sued everyone involved in the transaction.
According to the FBI, in 2020, consumers have lost nearly $ 230 million on similar schemes, 13% more than the previous year.
Today, most agent-client communication in real estate is done electronically. Regardless of the strictest measures being taken to avoid being hacked, preventing it completely is impossible, as there is no perfect protection.
Therefore, if you are a real estate agent or broker, it is advisable to have a Cyber Liability Insurance policy and another Errors and Omissions Insurance policy to protect your business from possible lawsuits from your clients. Do Real Estate Agents Need Insurance?
Call Univista Insurance and opt for the cheapest and most efficient commercial insurance to save your business.