Asked & Answered: Do I have coverage if I list my own property for sale?

June 2025

The answer is no.

If:

• you,
• your spouse, or
• a corporation or other legal entity in which either of you either separately or together, directly or indirectly, have more than a 10% direct or indirect interest,

have, may acquire or sell a beneficial interest in the property and get sued for professional negligence, you will not have coverage (Exclusion 9 of the Indemnity Plan). This exclusion applies even if you have complied with your professional obligations under the Real Estate Services Rules for disclosure of your interest in the transaction. The exclusion is strictly applied.

If you are sued in relation to the purchase or sale of your own property, you will not only have to pay a judgment if you are found liable, you will also have to pay for your own lawyer to represent you. That can be very expensive and a major hassle, even if you are able to prove that the claim against you is unmerited.

Some examples are situations where you will not have coverage if you list the property for sale include:

• A property that you own by yourself;
• A property you own jointly with your spouse;
• A property owned jointly by your spouse and her mother;
• A property that is owned by a company in which you own 100% of the shares;
• A property that is owned by a company in which your spouse owns 25% of the shares;
• A property that is owned by a company in which you own 10% of the shares and your spouse owns 5% of the shares (for a total ownership interest of 15%).

The Indemnity Plan does provide that your brokerage may be covered for such a claim if the brokerage is brought into the suit against you (Insuring Agreement 3.6), but if a payment is made by E&O on behalf of the brokerage, then E&O has the right to recover from you what they had to pay out.

Any way you look at it, this will be a bad situation for you; it’s far better to have someone else act as the professional real estate advisor where you or your spouse are involved in a transaction in which you have or may acquire an ownership interest.

Using a member of your own team to list your property for sale is also not recommended. As a member of the team, you must be listed as a seller’s agent on any disclosures and service agreements. Your team members will not lose coverage as long as they have no ownership interest, but the risks of a claim against you, your team members and your brokerage are increased when you are both the seller and the seller’s agent.