One of the traditional requirements for individuals who wish to obtain a brokerage license has been to demonstrate financial capacity to cover damage judgments brought against them by clients. In order to address this concern, some states have required licensees to first obtain:

A. Private mortgage insurance (PMI)
B. Errors and omission insurance
C. Deposit insurance
D. Hazard insurance

B. Errors and omission insurance

Explanation

Errors and omission insurance is the type of insurance that covers circumstances which the traditional liability insurance policies do not cover.

This type of professional liability insurance protects companies, its workers, and other professionals against claims of insufficiency or errors as a result of negligence.

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