Errors & Omissions Insurance (E&O)

Yes. Under the Real Estate Services Act (RESA) and its Rules, all licensed real estate professionals in BC must maintain E&O insurance as a condition of holding a licence issued by the British Columbia Financial Services Authority (BCFSA). The BCFSA administers a mandatory insurance program on behalf of licensees, meaning coverage is not optional. Licensees who fail to maintain required insurance risk disciplinary action, including licence suspension.

The British Columbia Financial Services Authority (BCFSA) administers the mandatory E&O insurance program for real estate licensees under the authority of the Real Estate Services Act (RESA). Licensees do not independently shop for E&O policies; instead, they participate in the BCFSA-administered group program. Premiums are typically collected as part of the licensing or renewal process.

E&O insurance covers claims arising from alleged negligent acts, errors, or omissions committed by a licensee in the course of providing professional real estate services, such as misrepresenting property details or failing to disclose a known material latent defect as required under RESA and its Rules. Coverage is subject to the specific policy terms, conditions, exclusions, and applicable limits in force at the time of the claim. It does not typically cover intentional misconduct, criminal acts, or fraud.

The scope of coverage depends on the specific terms of the BCFSA-administered E&O policy in effect, but the mandatory program is designed to cover professional services performed under a licensee's RESA licence, which can include residential and commercial trading services. Licensees should review the current policy wording available through BCFSA to confirm the precise scope of transaction types covered. Certain specialised activities may be subject to exclusions or additional conditions.

E&O insurance ultimately benefits both parties: it provides a financial remedy for consumers (buyers, sellers, landlords, or tenants) who suffer a loss caused by a licensee's professional error or omission, while also protecting the licensee from bearing the full cost of a valid claim. Under the Real Estate Services Act (RESA), licensees owe statutory duties to clients and third parties, and E&O insurance supports the ability to satisfy judgments or settlements arising from those duties. Consumers who believe a licensee has breached professional obligations may also file a complaint directly with the BCFSA.

Yes. Under the Real Estate Services Act (RESA) and BCFSA licensing requirements, managing brokers must hold a valid licence and are therefore subject to the same mandatory E&O insurance program as all other real estate licensees in BC. Managing brokers also carry additional supervisory responsibilities under RESA, meaning claims arising from inadequate supervision of licensees under their brokerage could potentially engage E&O coverage. Consult current BCFSA guidance for details on how supervisory liability is treated under the policy.

If a valid claim exceeds the applicable E&O policy limit, the licensee (or brokerage, depending on the circumstances) may be personally liable for the amount exceeding coverage. The Real Estate Services Act (RESA) and E&O policy terms govern how claims are paid up to the stated limits; amounts beyond those limits are not insured. Consult the current BCFSA policy documentation for exact per-claim and aggregate limits in force for the relevant policy period.

Yes. If a licensee makes an error or omission in connection with a strata property transaction — for example, failing to advise a client to review the Form B Information Certificate, depreciation report, or strata bylaws as contemplated under the Strata Property Act (SBC 1998, c. 43) — and a client suffers a resulting loss, an E&O claim could arise. The E&O policy covers professional services performed under the licensee's RESA licence, which includes strata trading services. Whether a specific strata-related claim falls within policy coverage depends on the policy's terms and exclusions.

E&O insurance primarily covers professional errors and omissions in the delivery of real estate services and does not typically function as a cyber-liability or privacy-breach policy. BC licensees handling client personal information are also subject to the Personal Information Protection Act (PIPA), which imposes its own obligations regarding collection, use, and safeguarding of personal data. Whether a privacy breach could give rise to an E&O claim depends on whether the breach also constitutes a negligent act in the provision of professional services under the policy terms; licensees should consult the current BCFSA policy wording for clarity.

A licensee who becomes aware of a potential E&O claim or circumstance that could give rise to a claim should promptly notify the BCFSA-administered insurer in accordance with the policy's reporting requirements, as late notification can affect coverage. The licensee should not admit liability or make any settlement offer without the insurer's involvement. If the client also files a complaint with the BCFSA, that disciplinary process is separate from the E&O insurance claims process, and both may proceed concurrently under the Real Estate Services Act (RESA).