Livestock and property businesses provide professional services, information, representations and advice that clients may rely on when making property, livestock and commercial decisions. Allegations that professional work was inaccurate, incomplete or negligent can lead to claims for financial loss, even where the work was performed in good faith. Professional Indemnity cover should be reviewed around the services the business genuinely provides.
Depending on the services performed, a Livestock & Property Agent business may be involved in property marketing and sales, livestock transactions, professional information, representations, reports, advice or related services. Where the business provides those services, clients may rely on them when committing to a transaction.
A client may later allege that an error, omission, negligent statement or failure in a professional service caused them financial loss. Professional Indemnity policies respond by reference to the professional services described in the policy, so the scope of insured services needs to match what the business genuinely does, and the claims-made position needs to be understood where relevant.
In NSW, professional indemnity insurance is a condition of a property and stock agent licence, including stock and station work. The regulation sets minimum cover of $1 million for any one claim and $3 million in aggregate. Requirements differ in other jurisdictions and should be checked for the licences held. A statutory minimum is not a recommendation of the limit a particular business should hold.
Allegations that advice or a professional service was negligent, incomplete or failed to meet the expected standard, depending on the insured professional services and policy wording.
Where the business prepares, adopts or passes on livestock descriptions, weights, classifications, breeding or health information, vendor declarations or other sale information, an allegation may arise if a client says the information was inaccurate or incomplete. The agent's role and the insured professional services still matter.
Claims may arise from allegations that professional information, statements or representations supplied during property, livestock or related transactions were inaccurate or misleading. Allegations of this kind may also involve misleading or deceptive conduct under Australian consumer law. Policy response depends on the insured professional services and policy wording.
Errors in professional documents, reports, correspondence or records may create an exposure where clients rely on that information.
The business may be responsible for professional work carried out by employees and, depending on arrangements and policy wording, contractors or consultants.
A professional allegation or formal inquiry can require legal representation and professional response costs even before liability is determined, subject to the policy.
A Livestock & Property Agent business provides information to a client during a property transaction. After the transaction completes, the client alleges that an important piece of information supplied as part of the professional service was inaccurate or incomplete, and that they suffered financial loss as a result. The business disputes the allegation and legal advice is required. If the matter falls within the professional services insured and the Professional Indemnity policy wording, the policy may respond to eligible defence costs and any covered settlement or damages.
Outcomes depend on the specific policy wording, insured professional services, retroactive date, limits, excesses, exclusions and circumstances of the claim.
Professional Indemnity policies differ between insurers and none of the following should be assumed. Areas worth reviewing include:
Professional Indemnity is commonly written on a claims-made and notified basis. The timing of a claim, a known circumstance, notification and any retroactive date can affect whether a policy may respond. Continuity between policies and run-off can also matter.
Professional indemnity cover should be looked at whenever the services, people or client work behind the business change. Review triggers include:
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Depending on the policy arranged and the professional services insured, it may respond to certain allegations of professional negligence, errors, omissions, misstatements or breaches of professional duty.
Eligible defence or inquiry costs may also be included. Everything remains subject to the policy wording, limits, excesses and exclusions.
Professional Indemnity generally concerns allegations arising from professional advice, services or representations that are said to have caused a client financial loss.
Liability Insurance generally concerns third-party personal injury or property damage arising from business activities. A business may need both, depending on how it operates.
Review is appropriate when professional services, staff, contractors, client work, legal entities, contractual requirements or policy limits change.
Professional Indemnity is commonly written on a claims-made and notified basis, so known circumstances, notification and continuity of cover can matter.
Ask RMA Insurance Brokers to review the professional indemnity arrangements for your Livestock & Property Agent business so they reflect the services, people and professional exposures in place today.
The information on this page is general and does not take into account your objectives, financial situation or needs. Consider whether the information is appropriate for you. Cover is subject to the terms, conditions, limits and exclusions of the relevant policy. Insurance products and available cover vary between insurers. Review the relevant policy documentation before making a decision.
