Here's something that surprises most new real estate agents in Florida: the state doesn't actually require you to carry insurance to get your license. No errors and omissions policy. No general liability. Nothing. But before you celebrate those potential savings, here's the catch—just because the state doesn't require it doesn't mean you won't need it. Your brokerage might. Your landlord might. And if you want to sleep soundly after closing a million-dollar deal, you definitely might.
Let's break down what insurance you actually need as a Florida real estate agent, what's optional, and what could save your career if something goes wrong.
What Florida Law Actually Requires
Florida law is pretty straightforward when it comes to insurance requirements for real estate agents: there aren't any. To get licensed by the Florida Department of Business and Professional Regulation, you need to complete your pre-licensing education, pass the state exam, and find a broker to sponsor you. Insurance? Not on the checklist.
This puts Florida in contrast with some other states that require surety bonds or mandatory errors and omissions coverage as part of the licensing process. Montana, for example, requires professional liability insurance for real estate professionals. Florida takes a different approach, leaving insurance decisions up to individual agents and their brokerages.
But here's where it gets interesting. Just because the state doesn't require insurance doesn't mean you can operate without it. The real requirements often come from the people you work with—your broker, your franchise, your bank, or your commercial landlord.
Errors and Omissions Insurance: Not Required, But Often Mandatory
Yes, you read that contradiction correctly. Florida doesn't require E&O insurance, but most brokerages do. And if your brokerage doesn't require it, your franchise probably will. And if you're somehow avoiding both of those, your lending partners might insist on it before they'll work with you.
Errors and omissions insurance protects you when you make a professional mistake—things like failing to disclose a property defect, making an error in contract paperwork, missing a deadline, or providing advice that turns out to be incorrect. In real estate, where transactions involve hundreds of thousands of dollars and complex legal requirements, mistakes can get expensive fast.
Here's a real scenario: You're representing a buyer on a waterfront property. You fail to notice that the dock permit expired two years ago, and the buyer completes the purchase expecting to use the dock immediately. When they discover the permit issue, they sue you for the cost of obtaining a new permit and the months of lost enjoyment. Without E&O insurance, you're paying that legal defense and any settlement out of pocket.
Most real estate professionals carry E&O coverage with limits of $1 million per claim, though some brokerages require higher limits. The cost is typically reasonable—often a few hundred dollars per year for individual agents—especially compared to the potential cost of defending against a single lawsuit.
Workers' Compensation: When You Need It (and When You Don't)
Workers' compensation requirements in Florida depend entirely on your business structure. If you're a solo agent working on commission as an independent contractor, you're typically exempt from workers' comp requirements. This exemption applies to most traditional real estate agents who receive 1099s rather than W-2s.
However, if you operate your own real estate business and employ four or more people, Florida law requires you to carry workers' compensation insurance. This includes administrative staff, showing assistants, or anyone else on your payroll. The key threshold is four employees—once you hit that number, coverage becomes mandatory.
There's an important distinction here: commission-only agents don't count toward that four-employee threshold. So if you're running a team with five agents who all work on commission, you likely don't need workers' comp. But if you have three commission agents plus one full-time administrative assistant, you're still under the threshold and exempt.
When you do need workers' comp, you'll need to provide proof of coverage. Insurance carriers may request copies of independent contractor agreements for any 1099 workers to verify they shouldn't be included in your policy. Getting this documentation right matters—misclassifying employees as independent contractors can lead to serious penalties.
General Liability Insurance: Protecting Against the Unexpected
General liability insurance isn't required by Florida law, but it's another coverage that often becomes mandatory through your business relationships. If you lease office space, your commercial landlord will almost certainly require proof of general liability insurance before you sign the lease. Business lenders may also require it as a condition of financing.
General liability covers bodily injury and property damage claims that occur during your business operations. Picture this: You're showing a house, and your client trips on a rug you moved during the showing and breaks their ankle. Or you accidentally knock over an expensive vase during an open house. General liability insurance handles these situations.
About 90% of real estate agents carry general liability coverage with $1 million per occurrence and $2 million aggregate limits. This has become something of an industry standard—high enough to satisfy most landlord and lender requirements without being prohibitively expensive. The average cost runs around $33 per month or $400 annually, which is pretty reasonable for the protection it provides.
Even if nobody requires you to carry general liability, consider your risk exposure. Real estate agents spend significant time in other people's properties, often moving things around, hosting open houses with dozens of visitors, and coordinating access for inspectors and contractors. Any one of these activities could result in an injury or property damage claim.
How to Get Started with Real Estate Agent Insurance
Before you start shopping for insurance, check with your brokerage about their requirements. Many brokerages offer group insurance options for their agents, which can provide better rates than buying individual coverage. Some even include basic E&O coverage as part of your desk fees or commission split.
If you need to purchase coverage independently, look for insurance providers who specialize in real estate professionals. They understand the specific risks you face and can often offer package policies that combine E&O and general liability coverage at a discount compared to buying separate policies.
When evaluating policies, pay attention to coverage limits, deductibles, and exclusions. Make sure your policy covers all your business activities—if you're also doing property management or real estate consulting, verify those activities are included. Some policies exclude certain high-risk activities or property types.
The bottom line? While Florida gives you flexibility by not mandating insurance for real estate agents, operating without proper coverage is risky. Between brokerage requirements, landlord demands, and the simple reality that mistakes happen in this business, most successful agents carry comprehensive insurance. The relatively small cost of coverage provides substantial peace of mind—and protection for the career you've worked hard to build.
