Errors & Omissions

Long & Foster Errors and Omissions Program

SALES ASSOCIATE PROFESSIONAL ERRORS & OMISSIONS PROGRAM 2026

READ THIS ENTIRE DOCUMENT TO UNDERSTAND THE PROGRAM

The reporting, intake, investigation, defense, resolution, and other handling of, consumer, regulatory, or other complaints or issues are governed by this Program in combination with the guidelines provided in the Sales Associate Policies and Procedures Manual (PPM) and Independent Contractor Agreement. Long & Foster Real Estate, Inc. (L&F) has the exclusive right to determine how to defend and whether to resolve/settle any matter covered by the Program. The cost for 2025 is $694/year; $347 due January 1st and July 1st; deductible is $3,500 per occurrence with no maximum coverage. 

Administrative Hearings Complaint Coverage is included at no additional election or cost and the deductible is $2,500 per occurrence with $12,500 of maximum coverage.

TERMS, CONDITIONS & LIMITATIONS
 

This section generally describes what kinds of complaints or claims are covered.

Generally, but not in all instances and subject to all the provisions of this document, L&F will defend and indemnify you, subject to the plan deductible from any claim asserted against you and/or L&F arising out of any licensed real estate activity which you conduct or are involved in on behalf of L&F (“Covered Claim”). Generally, but not in all instances and subject to all provisions of this document, there is no limit to the amount of coverage for the cost of defending you, resolving/settling a claim, or paying a judgment in connection with a Covered Claim.

This section describes terms, conditions, and limitations of the Program for various claims.

For Any Type of Claim to Be Covered:

(i) The alleged act or omission constituting a Covered Claim must have occurred at a time when you are,
or were actively licensed as a real estate salesperson affiliated with L&F and conducting licensed real estate activity on behalf of L&F; and
(ii) If you are currently licensed through L&F, you must be current in your obligation to pay the 2025 semi-annual Program fees due at the time that the covered claim is asserted; and
(iii) You must have immediately notified your sales office manager upon your receipt of any indication, oral or written, that any Covered Claim is or may be made (see details in Procedures section below); and
(iv) You must cooperate fully with L&F and its attorneys in defending the covered claim. This includes, but is not limited to, providing immediate notice to your manager, furnishing information and documents, preparing for, and providing testimony, and always following the direction of L&F and its attorneys.

If a claim arises that you are named in or were involved with after your affiliation with L&F ends, you will be covered under the Program and must pay all applicable deductibles. Any unpaid deductible may result in collection activity as permitted by applicable law.
 

For A Failure-to-Disclose/Misrepresentation of Property Condition Claim to be Covered:

This type of claim is based on an allegation that you made a representation or misrepresentation about, or failed to disclose, a material defect in or concerning a property. To be covered, the alleged representation, misrepresentation, or failure to disclose from which the claim arises must be based upon a statement or information provided to you by the property owner/seller, a licensed inspector, a licensed contractor, or a government official or agency.

NEW JERSEY NOTE: Sales Associates on New Jersey transactions MUST sign the Acknowledgement of Real Estate Broker/Broker-Salesperson/Salesperson on the Seller’s Property Condition Disclosure Statement. Failure to do so exposes the Sales Associate and L&F to claims for attorney fees and treble damages under the NJ Consumer Fraud Act (“NJCFA”) and increases the likelihood of such claims being brought. Therefore, any claims for failure-to-disclose/misrepresentation of property condition in New Jersey where the Sales Associate has failed to sign the Acknowledgement are NOT covered under this Program and the Sales Associate will be personally responsible to defend/indemnify themselves and L&F for all reasonable attorney fees/costs, settlements and/or judgments in such matters.
 

Limitations:

There is no coverage for claims:

• against Sales Associates for Bodily Injury, Property Damage, or Personal Injury liability whether the injury or damages are alleged to have been caused by any acts or omissions of Sales Associate, even if the injury or damage arises out of the Sales Associate conducting real estate business. This means that while some claims seeking damages for money spent or lost relating to a transaction are covered under this Program, NO claims seeking damages for an injury (such as tripping and getting hurt at an open house or being poisoned by undisclosed lead-based paint) are covered. There is no coverage for claims arising out of or relating to property management business or other real estate activities, unless the property management or other real estate activities is being conducted through and approved by an officer of L&F.

• based on or arising out of any dishonest, intentionally wrongful, grossly negligent, willful misconduct, criminal or malicious act or omission; however, if the complaint includes otherwise covered causes of action, defense of such claims will be provided until the dishonest, intentionally wrongful, grossly negligent, willful misconduct, criminal or malicious act or omission has been determined, found or adjudicated by or in any trial verdict, court or arbitration ruling, regulatory ruling or legal admission, whether appealed or not. Criminal proceedings are not covered under this program regardless of the allegations made against the Sales Associate.

• where the Sales Associate:

o did not attend mandatory legal education courses; or

o did not follow the company’s anti-fraud policies and procedures; or

o intentionally allowed an unauthorized third party to obtain information about an actual or potential customer, which resulted in fraud.
 

Other Limitations:

• Covered Claims do not include damages for:

o the return, reduction, or restitution of fees, commissions, or expenses;

o fine, penalties, forfeitures, or sanctions;

o the multiplied portion of any multiplied awards;

o injunctive or declaratory relief; or

o punitive, exemplary, or treble damages.

• While this agreement includes the conduct of commercial real estate business, there is no coverage for the sale of a business (Business Brokerage). This is outside the scope of a real estate license. In addition, Sales Associates should never be involved in valuing or pricing a business that is being sold.

• This program does not apply to commission disputes or claims of any kind, whether the claims are made against or by a Sales Associate, and no matter if the claims are made in a court or at an Association of Realtors. Refer to your Sales Manager and the Sales Associate Policies and Procedures Manual (PPM) for further guidance.
 

Property in which Sales Associates have a financial interest

General Coverage Conditions:

This Program applies to the listing for sale or lease of property in which Sales Associates have a financial interest. The coverage conditions are set forth below. Under no circumstances may a Sales Associate with a financial interest (as defined below) represent a buyer (or tenant) in the purchase (or lease) of that property.
 

For residential property owned for more than 365 days, developed, constructed, or renovated by a Sales Associate or an entity in which the Sales Associate has a financial interest, this program provides protection for claims ONLY IF all the following conditions are met:

• A written home inspection report is issued by an ASHI or CREIA inspector; unless waived in writing by all buyers in the Agreement of Sale or otherwise (for sales); and

• the seller completed and signed, and the buyer acknowledged receipt of a seller property disclosure statement prior to closing (for sales); and

• a state or local board-approved, or buyer/tenant attorney-drafted agreement of sale or lease for is used.
 

FOR PROPERTY IN WHICH YOU HAVE A FINANCIAL INTEREST, FAILURE TO MEET EACH OF THE CONDITIONS ABOVE WILL RESULT IN YOU NOT BEING COVERED FOR ANY CLAIMS ARISING OUT OF THE LISTING OR RESULTING TRANSACTION, AND YOU MUST DEFEND/INDEMNIFY YOURSELF, L&F, ITS SALES ASSOCIATES, PARENTS, AFFILIATED BUSINESSES, EMPLOYEES, AND THEIR HEIRS AND ASSIGNS FROM ALL SUCH CLAIMS.
 

ANY COVERAGE AFFORDED TO A SALES ASSOCIATE IS IN THEIR CAPACITY AS A LICENSED REALTOR® AND SHALL NOT INURE TO THE BENEFIT OF ANY OTHER OWNERS OF THE PROPERTY.
 

Commission Concessions & Consumer Claims:

If a claim is made during a transaction which is resolved during the transaction (prior to the conclusion of settlement) by way of a commission concession, the resolution will not be covered by this Program. It is required that Sales Associates discuss such situations with their manager prior to making a commitment to a consumer. Additionally, no claim for payment of funds or for credit based upon an actual or alleged agreement to discount, share, refund or rebate commission will be covered by this Program.
 

Administrative Hearings/Complaints:

When a complaint is filed, it will be reviewed on a case-by-case basis by the Regional Manager in conjunction with the Legal Department. The Regional Manager and the Legal Department will determine whether legal representation reimbursement under this Program is appropriate. The reason for this review is that there are occasions when legal representation is not warranted. For example, a customer may make an improper complaint against an agent for his or her failure to return an earnest money deposit. In this type of case, the matter could be disposed of without the assistance of counsel; therefore, the expense of representation would not be warranted. If legal representation is warranted, the Regional Manager and the Legal Department, in consultation with the Sales Associate, will select counsel to represent the Sales Associate. 

If approved by the Legal Department as a covered claim, payment of the first $2500 in legal fees is the responsibility of the Sales Associate. Once this amount has been paid, L&F will pay the remainder of legal defense costs up to a maximum of $15,000.00 per complaint. i.e., the Sales Associate will pay the first $2500, and L&F will pay the next $12,500 then the Sales Associate is responsible for any additional amounts. This is per complaint. This does not include, and Sales Associates should expect to pay, regulatory or administrative fines or penalties assessed against them. Under no circumstances will L&F defend or indemnify any claims or defense costs arising out of intentional or illegal acts/omissions.

Transferability 

This program is not transferable if a Sales Associate leaves L&F and goes to another company. In the event the Sales Associate leaves L&F, benefits are available to said Sales Associate only if the Sales Associate had paid for the Program for the year when the Sales Associate left L&F and the complaint related to an event that occurred while the Sales Associate was associated with L&F. Also, when a Sales Associate leaves L&F during the year, any fees paid by the Sales Associate for the Program will not be pro-rated nor returned to the Sales Associate. This program does not apply to transactions that occurred while the Sales Associate was with a previous or subsequent broker even if the claim arises while the Sales Associate is with L&F.
 

PROCEDURES

When and to Whom you MUST provide notification

You must immediately notify your sales office manager and the L&F Legal Department as soon as matters involving consumers and transactions appear to be headed towards an investigation, claim, mediation, arbitration, lawsuit or any other legal or regulatory proceeding. Once you have reported the matter, wait for guidance before you take any action, including communications with anyone else about the issue.
 

FAILURE TO PROVIDE IMMEDIATE NOTICE TO YOUR MANAGER AND WAIT FOR GUIDANCE WILL RESULT IN YOU NOT BEING COVERED FOR THAT ISSUE, AND YOU MUST DEFEND/INDEMNIFY YOURSELF, L&F, ITS SALES ASSOCIATES, PARENTS, AFFILIATED BUSINESSES, EMPLOYEES, AND THEIR HEIRS AND ASSIGNS.

Matters for which you need to provide immediate notice include, but are not limited to:

• Receipt of oral or written indication that a claim is being made or may be made.

• Receipt of a demand for money or other financial accommodation in connection with a transaction or your work as a Sales Associate.

• Receipt of a lawsuit or other legal papers filed with or issued by any court, Association of REALTORS®,
arbitration or mediation service, regulatory agency, law enforcement agency or department, or any
other such entity.

• Receipt of a subpoena or any other request (whether it is formal or informal) to provide testimony, documents, or other information in connection with an investigation, claim, mediation, arbitration, lawsuit, or any other legal or regulatory proceeding.

• Contact from any regulator, such as a state real estate commission, state or local human relations commission, state attorney general’s office, any law enforcement agency or department, Consumer Financial Protection Bureau (CFPB), Housing & Urban Development (HUD), etc.
 

© 2025 Long & Foster Real Estate, Inc. An independently operated subsidiary of HomeServices of America, Inc., a Berkshire Hathaway affiliate. Berkshire Hathaway HomeServices and the Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc.® Equal Housing Opportunity.