PARRIS N. GLENDENING, Governor

Ch. 389

Article - Business Occupations and Professions

17-529.

(A) AT THE TIME A REAL ESTATE BROKER OFFERS AN ASSOCIATE REAL
ESTATE BROKER OR REAL ESTATE SALESPERSON COURAGE UNDER A POLICY
PROVIDING ERRORS AND OMISSIONS INSURANCE, THE REAL ESTATE BROKER
SHALL PROVIDE THE ASSOCIATE REAL ESTATE BROKER OR REAL ESTATE
SALESPERSON WITH:

(1) A COPY OF THE POLICY;

(2) AN EXPLANATION OF THE EXTENT OF THE POLICY'S COVERAGE OF
ERRORS AND OMISSIONS;

(3) AN EXPLANATION OF THE CIRCUMSTANCES UNDER WHICH THE
ASSOCIATE REAL ESTATE BROKER OR REAL ESTATE SALESPERSON WILL CEASE TO
BE COVERED UNDER THE POLICY;

(4) NOTIFICATION AS TO WHETHER THE REAL ESTATE BROKER IS
SELF INSURED OR WHETHER THE REAL ESTATE BROKER OBTAINED THE POLICY
FROM A COMMERCIAL INSURER; AND

IF THE REAL ESTATE BROKER OBTAINED THE POLICY THROUGH A
COMMERCIAL INSURER, THE NAME OF A CONTACT PERSON WITH THE COMMERCIAL
INSURER.

(B) AFTER THE REAL ESTATE BROKER HAS PRESENTED TO THE ASSOCIATE
REAL ESTATE BROKER OR REAL ESTATE SALESPERSON THE INFORMATION
DESCRIBED IN SUBSECTION (A) OF THIS SECTION, THE ASSOCIATE REAL ESTATE
BROKER OR REAL ESTATE SALESPERSON SHALL SIGN A STATEMENT
ACKNOWLEDGING THE RECEIPT OF THE INFORMATION.

(C) IF AN ASSOCIATE REAL ESTATE BROKER OR REAL ESTATE SALESPERSON
ACCEPTS A REAL ESTATE BROKER'S OFFER OF ERRORS AND OMISSIONS COURAGE,
A REAL ESTATE BROKER WHO FAILS TO COMPLY WITH THE PROVISIONS OF
SUBSECTION (A) OF THIS SECTION IS LIABLE FOR:

(1) ANY LAPSES IN THE COURAGE OF THE ASSOCIATE REAL ESTATE
BROKER OR REAL ESTATE SALESPERSON UNDER THE OFFERED ERRORS AND
OMISSIONS COVERAGE; AND

(2) ANY ECONOMIC LOSS INCURRED BY THE ASSOCIATE REAL ESTATE
BROKER OR REAL ESTATE SALESPERSON AS A RESULT OF AN ACTION THAT WOULD
HAVE BEEN COVERED UNDER THE OFFERED ERRORS AND OMISSIONS COVERAGE

(A) THIS SECTION APPLIES TO A REAL ESTATE BROKER WHO PURCHASES
ERRORS AND OMISSIONS INSURANCE THAT PROVIDES COVERAGE TO THE
ASSOCIATE REAL ESTATE BROKERS AND THE REAL ESTATE SALESPERSONS WHO
ARE AFFILIATED WITH OR EMPLOYED BY THE REAL ESTATE BROKER.

(B) A REAL ESTATE BROKER SHALL PROVIDE IMMEDIATE NOTICE OF A
DISCONTINUANCE OF THE BROKER'S ERRORS AND OMISSIONS INSURANCE TO

- 2603 -