Doc Summary
Potentially, yes.
Operating as a sole trader does not remove the professional liability exposure associated with providing real estate services.
A claim can still be made personally against a sole trader if another party alleges that their professional services caused financial loss.
Examples can include allegations involving:
- Incorrect property information
- Advertising errors
- Failure to follow client instructions
- Property management errors
- Documentation mistakes
- Professional advice
- Breach of professional duty
Depending on the policy, Professional Indemnity Insurance can assist with:
- Defence costs
- Expert expenses
- Insured compensation or damages
- Approved settlements
Is Professional Indemnity legally required? #
That depends on the licensing requirements applying where the Real Estate Agent operates.
For example, Real Estate Agents carrying out licensed activities in New South Wales must generally be covered by complying Professional Indemnity Insurance.
Other requirements can also arise from:
- Franchise arrangements
- Contracts
- Industry memberships
Do not assume another agency or network’s insurance automatically covers your sole trader business.
The insured entities, activities, limits and policy terms should be checked.
Contact our team if you need help determining what insurance applies to your Real Estate Agent business.
