Mortgage broker insurance combines professional indemnity cover with policies for the brokerage’s other business risks. Staff, premises, equipment, client data and vehicle use determine which additional policies you need.
A sole trader working from home has different exposures from a brokerage with employees and a leased office. Map those exposures before comparing quotes, then keep the policy documents with your compliance records.
Professional Indemnity Insurance in Brief
Professional indemnity (PI), also called errors and omissions insurance, responds to covered claims arising from professional services. ASIC (Australian Securities and Investments Commission) RG 210 identifies PI as the primary way non-APRA credit licensees meet compensation obligations. If you work under a licensee, confirm your cover in writing and use our PI policy guide for wording, retroactive dates and licensee arrangements.
Insurance for the Brokerage’s Other Risks
Match each business policy to the exposure it covers. Professional claims, damage to equipment and workplace injuries involve different risks and policy terms.
Public Liability and Business Property
Public liability can cover liability for injury or property damage caused by the business’s negligence. Business property cover protects insured premises or contents against specified events. List portable equipment separately where the policy requires it.
For example, a client injured at your office raises a public liability question. A laptop stolen on the way to a client meeting raises a property or portable equipment question. Check the policy for each location where you work.
Cyber Insurance
Cyber insurance can cover specified costs after a cyber event, including data recovery and business interruption. Compare the incident-response support and exclusions in the wording.
Entities covered by the Privacy Act must assess suspected eligible data breaches. Under the OAIC’s notification test, unauthorised access, disclosure or loss must be likely to cause serious harm, with remedial action unable to prevent that risk. An eligible breach requires notification to affected people and the Office of the Australian Information Commissioner (OAIC).
Assign responsibility for the assessment and notification before an incident occurs. Use the mortgage broker data security guide for the controls that support your cyber cover.
Workers’ Compensation
Workers’ compensation rules differ by state and territory. For employees and contractors, establish which jurisdiction’s rules apply and whether each person meets its definition of a worker. Business.gov.au lists the relevant regulators.
Motor Use for Client Visits
Declare client visits and other business travel to your motor insurer. Get written confirmation that the policy covers the declared use. Record who owns each vehicle and who drives it for work.
How to Compare Insurance Policies
Compare quotes using the same business description and cover settings. A cheaper premium can leave you paying more if the policy excludes work or equipment another quote covers.
- Match the insured legal entity and declared activities to the brokerage’s actual work, including contractors and any services beyond credit assistance.
- Compare the limit and excess on the same basis. Identify any separate limits for particular losses and whether defence costs reduce the amount available.
- Read exclusions against the exposures you listed. Check how each policy treats cyber events and equipment away from the office.
- Ask how and when to notify a circumstance that could become a claim. Keep the notification instructions where the team can find them.
- Confirm who provides claims support, how to contact them and what evidence they need.
Ask the insurance broker to explain differences in writing before you accept a quote. Keep those answers with the policy schedule so the renewal comparison starts from the same cover.
What Affects the Cost
Revenue, staff numbers, services, claims history, limits, excesses and risk controls can affect the premium. Property values, vehicle use and the amount of client data also shape the cost of additional policies.
A current Australian quote for your declared activities is more useful than a published range. Two brokerages with similar revenue can need different cover because one has staff and premises while the other works remotely.
When budgeting to start a mortgage brokerage, include the required policies and the excesses the business would need to fund after a claim.
Insurance Review Checklist
Use these five checks before renewal and repeat them when the business changes.
- List the legal entities, credit appointments, staff, premises, equipment, vehicles and systems used by the business.
- Obtain the current PI certificate and policy wording. Confirm that the insured activities match the brokerage.
- Check public liability, property, cyber, workers’ compensation and motor exposures against the way the team works.
- Record renewal dates, claims contacts and the process for reporting a circumstance.
- Repeat the review after a new appointment, service, employee, office or major technology change.
Finish the review with a record of each exposure, its policy and the person responsible for resolving any gap. Keep written confirmation of changes with the current documents.
Common Insurance Questions From Brokers
Does PI cover every complaint?
No, cover depends on the policy wording, dates, exclusions and facts of the claim. Notify the insurer promptly when a complaint or circumstance could lead to a claim.
Does an office pack cover equipment used at client meetings?
It depends on whether the policy includes portable equipment away from the insured premises. Check the locations, item limits and theft conditions for laptops or other equipment you take to meetings. Add the required cover before relying on the office pack for those items.
When should the insurance program be reviewed?
Review the program before renewal and whenever the business changes. A new service, employee, office, contractor or software platform can create an exposure the previous declaration did not describe. Update the insurer’s declaration and obtain confirmation of any change in cover.
