Working in real estate and running a small business are complex endeavours — and real estate agents must be across both.
That’s why so many agents rely on insurance to help them manage risks to their businesses.
Whether you’re a sole trader or run an agency, having appropriate insurance for your business needs is viewed by many as essential.
As a real estate agent, you may already have different types of cover in place, such as business insurance packs, public liability and professional indemnity.
The latter is a very popular type of cover within many professional occupations, which need to provide a professional service or give advice to their clients.
Here is a real-life example of a professional indemnity claim from a BizCover customer:
Mistakes and professional negligence
Professional indemnity insurance* is mandatory for real estate agents in most states and territories.
However, these policies are more than just a licensing requirement.
They can provide crucial protection for your business, even when you are not solely at fault.
Take this example†: A client contracted an insured real estate agent who specialises in duplex developments to help them buy a suitable property for development.
The insured real estate agent showed the client a land parcel valued at $240,000 that the selling agent advertised as fit for duplex allotment.
Over multiple phone discussions, the selling agent assured the insured real estate agent that the land parcel was a feasible duplex site.
Based on this information and the selling agent’s track record of successful duplex sales in the area, the insured agent recommended the land to their client to construct a duplex.
However, after consultations with the council and town planner, the client discovered that the parcel was unsuitable for a duplex due to access issues.
The client incurred around $30,000 in losses, including stamp duty, legal fees, and other expenses related to the purchase and resale of the land.
The insured real estate agent made a claim under their professional indemnity policy.
The insurer recognised that the selling agent was also partially liable for providing inaccurate advice and agreed to pay $17,000 for legal defence costs and payment for some monetary damages to the client.
Settling claims can be expensive, even if you are only partially at fault (or not at all).
Professional indemnity insurance can provide essential cover to help you defend your reputation and set things right with your clients.
Protect your agency with BizCover
Business insurance helps real estate agents manage risks to their businesses—and BizCover makes it easy for them to find and buy the right cover for their business needs.
Compare quotes for professional indemnity, cyber liability, business insurance packs and more online, buy in minutes, and receive instant policy documents.
You might save money by switching insurers—like Julia, a NSW real estate agent who saved $500 on her professional indemnity and public liability insurance with BizCover‡.
Switch and save with BizCover today—visit bizcover.com.au or call 1300 249 268.
*This information is general only and does not take into account your objectives, financial situation or needs. It should not be relied upon as advice. As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording.
†The provision of the claims examples are for illustrative purposes only and should not be seen as an indication as to how any potential claim will be assessed or accepted. Coverage for claims on the policy will be determined by the insurer, not BizCover.
‡ Savings made in June 2023. This information is provided as a guide only and may not reflect pricing for your particular business, as individual underwriting criteria will apply.
