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Property Managers: Dealing in Insurance – Are You Authorised?

By Sarah Barton, Terri Scheer Insurance Distribution Channel Manager

Most property owners appoint a property manager to ease the administrative burden of owning a rental property.

While property managers can generally assist with most aspects of owning a rental, there are some tasks they may not be able to perform – including placing landlord insurance on the owner’s behalf.

At Terri Scheer we are often approached by property managers who have been asked by their landlords to arrange insurance.

However, in many cases the property manager has not been appointed as a distributor and therefore is not authorised to take out insurance on the property owner’s behalf.

What is the benefit of ensuring property owners hold landlord insurance?

Many property managers want to ensure their landlords have good insurance policies in place as it can simplify the property manager’s job down the track should the landlord need to make a claim.

However, property managers should pay close attention to ensure they are not providing advice or dealing in insurance, if they are not authorised to do so.

I am an authorised distributor. What can I do?

A distributor is able to deal in insurance on behalf of their property owner. This enables the distributor to speak with the insurer, place cover, amend cover and cancel a policy. A distributor can also pay invoices and submit claims on behalf of the property owner.

Property management businesses can become distributors with Terri Scheer. An authorised representative from the business signs an appointment letter on behalf of their office and is issued Terri Scheer’s Distributor Operations Manual which guides them through the landlord insurance distribution process.

The authorised person then sub-appoints their employees, including new employees joining the business after the initial appointment.

All appointed employees must complete an annual compliance module before dealing in insurance and adhere to the obligations set out in the Distributor Operations Manual.

I am not an authorised distributor. What can I do?

For property managers who are not distributors they can still inform their property owner of the existence of landlord insurance in the form of a brochure. The property owner must complete and sign the application form and send it directly to us by email. Alternatively, they can apply online through the Terri Scheer website.

It’s important that property managers are aware, if they are not a distributor, that their landlords must apply direct and that landlords cannot provide signed forms to a property manager to be submitted on their behalf.

If the property owner authorises it, property managers are able to pay invoices and lodge claims on the property owner’s behalf.

Be careful not to give advice

Regardless of whether you’re a distributor or a referrer, property managers are not permitted to recommend or influence property owners in their decisions to buy or dispose of financial products, including landlord insurance.

Keeping your conversations factual will assist in not breaching this obligation.

Our team at Terri Scheer is here to support property managers, so if you have any questions about your level of authority or would like to become a distributor please do give us a call.


Disclaimer:

Insurance issued by AAI Limited ABN 48 005 297 807 AFSL 230859 trading as Vero Insurance. In arranging your insurance, Terri Scheer Insurance Pty Ltd ABN 76 070 874 798 AFSL 218585 acts under authority given to it by Vero Insurance. Read the Product Disclosure Statement before buying this insurance and consider whether it is right for you. Contact Terri Scheer on 1800 804 016 or visit our website at www.terrischeer.com.au for a copy.

The information contained in this article is intended to be of a general nature only. Terri Scheer does not accept any legal responsibility for any loss incurred as a result of reliance upon it. This article has been prepared without taking into account your particular objectives, financial situation or needs, so you should consider whether it is appropriate for you before acting on it. The Target Market Determination is also available.

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