With the fallout from the subprime mortgage crisis expanding, insurers that write errors and omissions coverage are beginning to adapt their strategies as claims mount for certain classes of business and securing coverage gets harder for many real estate players.
Many claims that arise in the financial sector have, to some degree, an E&O component, according to Michael Smith, president of AIG Executive Liability.
He added that the subprime mortgage crisis has either prompted or could spur lawsuits for real estate appraisers, home inspectors, real estate agents, mortgage brokers and bankers, lenders, rating agencies, and ancillary service providers.
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