Professional Indemnity Reform Provides more protection for Consumers and Agents

Minister for Fair Trading Anthony Roberts has announced consultation on proposed
compulsory professional indemnity insurance for licensed property occupations, to ensure
consumers’ compensation claims for loss or injury can be met by industry members such
as real estate agents and strata managing agents.

Mr Roberts said proposed professional indemnity insurance means consumers renting or
living in a strata scheme have the security of knowing that if they are entitled to financial
compensation, the agent has the insurance to cover the claim.

“Given the risks associated with liability confronting the property industry, it makes sense
to require the industry to hold appropriate professional indemnity insurance cover,” Mr
Roberts said.

“The majority of the property industry already holds this kind of insurance however it is
essential that those who do not are brought in line with best practice standards.”

It is proposed from 1 January 2013, all licensees under the Property, Stock and Business
Agents Act 2002 be required to hold a minimum of $1 million professional indemnity
insurance with a number of set policy inclusions.

“The NSW Government values the comments of all interested parties on this important issue and NSW Fair Trading will carefully consider all views before finalising a proposal,” said Mr Roberts.

NSW Fair Trading has released a draft Amending Regulation proposing the introduction of mandatory professional indemnity insurance and is seeking feedback by 5 October 2012.

Copies of the Amending Regulation can be found on the Fair Trading website at
www.fairtrading.nsw.gov.au.

Estate Agents Co-operative Ltd has previously provided feedback on this proposal in our meetings with Fair Trading and will be making a submission. If you have any feedback on the draft Amendment regulation please forward them to our Practice Support Team.

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