NSW Fair Trading: Announcement

On 1 January 2013 a new regulation was introduced making it mandatory for licensed property agents to be covered under a policy of professional indemnity insurance held in their own name, or held for them by their employer.

Professional indemnity insurance is intended to provide protection to policyholders for claims made against them relating to acts or omissions committed in a professional capacity.

Transitional arrangements are in place, meaning that the requirement does not come into effect until 1 July 2013, allowing licensees who do not presently have insurance time to obtain suitable coverage. Additionally, if a licensee is covered under an existing policy issued before 1 January 2013, the policy will be deemed to comply with the regulation until the policy expires or until 1 January 2014, whichever comes first.

The requirement for mandatory professional indemnity insurance applies to all licensees under the Property, Stock and Business Agents Act who engage in activities for which a licence is required. Those who do not currently conduct activities under their licence, for example educators, trainers, unemployed licensees and licensees employed in other industries, do not need to hold insurance.