Mortgage brokers: public liability requirements in New South Wales

Verified for New South Wales

• Licence liability condition: Yes, in substance. The National Credit Act requires a licensee to have "adequate arrangements in place for compensating your consumers for any loss they might suffer" if the licensee breaches its obligations. ASIC's position is that "for most applicants, the way to comply with this obligation is to have adequate professional indemnity (PI) insurance cover" — so the statute requires compensation arrangements and PI insurance is the ordinary means of meeting them, rather than PI being named in the Act itself. NSW · effective 2010-07-01 ASIC · 2026-08-24
• Licence evidence required: At licence application. ASIC must confirm adequate PI insurance is held where it is required, and asks the applicant to provide a certificate of currency — a summary of the policy obtained from the insurer or broker. The compensation obligation then continues for as long as the licence is held. NSW · effective 2010-07-01 ASIC · 2026-08-24
• Licensing body: ASIC — and this is a FEDERAL requirement, not a New South Wales one. Credit activity is licensed nationally under the National Consumer Credit Protection Act 2009 (Cth); the credential is an Australian credit licence, or authorisation as a credit representative of a licensee. NSW has no separate mortgage broker licence. NSW · effective 2010-07-01 ASIC · 2026-08-24

What contracts commonly ask for

Principals and head contractors set their own insurance requirements, and those are frequently higher than a licence condition. The requirement that binds is the higher of the two, and both have to be read from the actual document.

• What the limit figure on a certificate means
• Cover for the principal for your work
• When a certificate falls short of the contract

What this cover costs

This site publishes no cost benchmark for this cover. A benchmark needs a real sample of documents, and none is published until the sample is large enough to compute a median honestly. A benchmark from a handful of policies is a guess with a decimal point.

Sources

• ASIC — Australian Securities and Investments Commission