A key part of being a leader in any organization is finding and retaining top talent in their field. But this is often easier said than done, and many people find themselves wondering what best practices they can implement to keep their employees satisfied and engaged in the long term. In the real estate industry especially, keeping talented employees within your organization can help your firm’s rise to success. Keeping a successful real estate agent who is a good fit for your company culture and has proven themselves within your office is far better than using your valuable time and resources attempting to find a replacement with the same positive attributes. And there’s something to be said about the very real costs associated with worker turnover, which can run into the tens of thousands of dollars per employee.
For real estate brokers wondering how they can keep employees within their organization for years to come, there are a few key points to be understood.
Why Retaining Good Real Estate Agents is Key to Your Success
How keeping top performers at your company benefits your business is a matter of simple economics. It costs money to find and recruit new talent versus keeping people who are already established at your firm. There are also fewer tangible costs to your company that you can potentially face when employee turnover is high. For these reasons, it’s best to take the necessary steps needed to avoid a high turnover rate.
The monetary costs, or true cost, of keeping good real estate agents rather than recruiting new ones are easiest to address if the process of an employee leaving is understood. When an employee leaves an organization, the hiring team must start recruiting for their replacement. Recruiting costs both time and money, which is spent on advertising for the position, interviewing candidates and eventually hiring a new employee.
Once an employee is hired, the costs keep mounting with organizational onboarding and training taking leadership away from other normal day-to-day. Even after an employee has been trained, they’ll need time to reach the expected output and efficiency necessary to perform their duties as a real estate agent within the firm. They may need to shadow other agents before they’re ready to take on clients of their own and may require additional training to ensure that they’re fully equipped to perform their best.
There are also “soft costs” associated with replacing a real estate agent who has left your organization. First and foremost, you run the risk of replacing them with the wrong person. If someone isn’t the right fit for your company, causes internal turmoil, or otherwise cannot perform their job to your standards, it can equate to more time and money wasted trying to either “make it work” or again finding someone to replace to the wrong fit.
The issue of employee morale is also something else to consider – if the turnover rate is high, this can affect the morale among their remaining coworkers, who may start questioning the benefits of their own jobs and whether or not they should seek employment elsewhere too.
All in all, some experts estimate that the cost of replacing a real estate agent can amount to tens of thousands of dollars, and that’s simply an expense that no real estate broker wants to be added to their already long list of expenses to keep their business going. Ultimately, a real estate agent leaving a firm is a hit that some brokers can’t afford to take.
In summary, any effort spent to keep good people and top talent at your real estate firm is worth many times the cost of advertising, hiring and training new employees. In the long run, they’ll end up making more money for your business, while you rest assured knowing they’re a good fit for your organization. Investing in your great employees and providing them with a positive, engaging environment, gives them a reason to stick around. And sticking around means a lower turnover rate, which equals keeping your top talent. Consider it a return on your investment.
Tips for Keeping Your Best Agents
So, how do brokers keep their best agents invested and engaged in their organization so that they don’t seek employment elsewhere? The answer comes down to one simple thing: be the best place to work. If your firm is the best place for real estate agents to be, they’re less likely to leave in search of a better workplace. It’s a simple concept but making your firm the best place to work is much easier said than done. To that end, there are a few things you can do to ensure that your firm is the best place to work in your local industry.
Perhaps the easiest way to make your firm the best place to work is to give your team a purpose – a reason for waking up in the morning and being excited to come to work, a winning “battle cry” for them to rally around and take part in. Everyone wants to feel like they’re on the winning team, so it would benefit your firm to create a story about why your business is “winning.” This can be in the form of a mission statement or core values that employees can implement and rally behind. Make sure that your story takes center stage at internal meetings and that staff is continuously reminded of it so that they can draw motivation from it.
The next step is to invest in their development as employees at your firm. Use your human capital wisely and consider what motivates them. If pursuing continuing education in real estate is important to them, provide ways for them to earn CEU credits. Determine their interests in the world of real estate and see to it that they’re able to pursue those interests while working for you. Help them grow in their careers and obtain the knowledge they need to get to the next step they’d like to reach in their career goals.
You’ll also want to continuously demonstrate to your employees that they’re valuable to you. If real estate agents see themselves as valuable to a firm, they’ll be more inspired by the idea of teamwork you’re communicating within your organization. With everyone working together to reach both their personal goals and the goals of the firm – with the knowledge that their leadership considers them an asset to the organization and wants them to succeed – your firm will benefit from both a positive workplace environment and lessened costs as a result of turnover.
One of the best ways to show employees that you value them and their work is to invest in them with comprehensive insurance coverage – namely, errors and omissions (E&O) insurance.
E&O Coverage is an Important Investment in Agent Retention
E&O coverage is a form of professional liability insurance designed to protect real estate agents and their employers against clients’ claims of negligence or inadequate work. Unfortunately, it can’t always be assumed that every sale will unfold seamlessly and that all buyers and sellers will be reasonable. And although a particular property might have great curb appeal, sometimes the flaws within are easily masked – leading to potential legal disputes after the sale has closed. Similarly, if something goes wrong during the purchase process, your clients may look to legal ways they can pursue your firm for financial relief.
A claim may be filed against you or your agents if your agent lists a property without disclosing its flaws, a property is described incorrectly in a listing, you fail to disclose all liens on a property or if you fail to serve your client’s best interested. And those are only a few ways you can get embroiled in a legal dispute over an error or omission – there are countless other ways that not having E&O insurance coverage for you and your agents can come back to haunt you.
E&O insurance turns the uncertainty of doing business in the real estate industry into a known and predictable expense – meaning that when you purchase E&O coverage, you’re converting a potentially large (but unknown) loss into a much smaller cost that you can budget through an E&O insurance premium. By neutralizing that risk, it won’t be hanging over your head – and you’ll be able to operate with less worry and stress. If a client does file a claim against you, your policy will protect against covered judgments, settlements, attorney fees and court costs – essentially becoming your financial safety net.
It’s easy to see how having E&O insurance can benefit your firm from a legal standpoint, but what are the other benefits of having error and omission coverage? To start, E&O insurance coverage is affordable, and for that affordable price, you’re getting comprehensive coverage that will help mitigate a financial hit to your firm in the event that you become involved in a legal battle.
It’s also easy to get set up with E&O insurance coverage – it can be added to your existing plan simply by reaching out to your insurance carrier and discussing coverage options with them. And once your insurance is acquired, you’re covered against errors and omissions claims filed against you for the long term.
Not only is E&O insurance easy to obtain and very affordable, but it can also result in your agents feeling valued. If they’re covered by E&O, they’ll know that as a leader in the firm, you have their best interests as agents in mind when considering their long-term success. Covering your real estate agents with E&O insurance may ultimately be a barrier to exit for them in terms of staying with your firm. They can see the benefits of being covered versus working for a firm that doesn’t cover them.
Of course, E&O insurance isn’t required in every state, and those in states in which it isn’t required often tend to rationalize not purchasing coverage by assuming they’ll never make a mistake. But the bottom line is that the real estate marketplace can often prove to be hazardous, and doing business with E&O coverage lessens your exposure to extreme risk.
360 Coverage Pros – E&O for Real Estate
Individual Agents and Real Estate Brokerages need an E&O Insurance policy to protect them against claims of alleged or actual professional mistakes, which can cost thousands or more in fees, judgments, fines and penalties. Without E&O coverage, you can be left defenseless and entirely responsible for your claim costs. With Real Estate Agent & Broker E&O Insurance from 360 Coverage Pros, you can easily enroll in affordable protection and choose from various coverage options to suit the needs of your business. Learn more and apply for coverage or schedule your free consultation with a policy expert for a pressure-free call to discuss your insurance needs and answer any questions.
At the end of the day, you want to ensure the success of your business. There are many ways to run a successful business, and those include making sure that your employees are engaged, satisfied and protected. The truth is that liability claims against a real estate firm are common, and just as you’d want to avoid the high costs associated with replacing a top agent, you also want to avoid the risk of high costs associated with legal claims and complicated legal battles. To that end, enrolling in E&O insurance for your real estate firm is the best way to communicate to your employees that you value their profession and that their work is important to your success. Take the success of your business into your own hands – don’t wait to apply for errors and omissions coverage.
Share this page.