Proposed PI changes will not apply to brokers

by Julia Corderoy25 Aug 2015
The Australian Registrars' National Electronic Conveyancing Council (ARNECC) has confirmed to the MFAA that brokers will be exempt from the proposed changes to professional indemnity insurance cover.

Last week, Australian Broker reported on the MFAA’s lobbying efforts to stop ARNECC’s proposal to increase professional indemnity insurance to $20 million in the aggregate, from a current figure of $2 million per claim and up to $6 million in the aggregate. The MFAA was concerned that, if passed, it would be a significant cost for broker businesses and could harm broker/client relationships.

“Although there has been some difference of opinion about the breadth of the impact, we take the issue seriously whether it impacts 1 broker or 10,000. We regard all brokers as important so we acted immediately,” MFAA CEO, Siobhan Hayden said.

Since then, leading lobbyist group Hawker Britton – which was appointed by the MFAA to assist with the issue – sat down with the deputy chair of ARNECC, Ian Ireson, who confirmed the changes will not apply to brokers.

“I was really impressed by the actions of the MFAA members who communicated their desire to support this action with letters and emails to elected representatives and directly to ARNECC. They took on the task of delivering an industry-wide voice through direct action, and it had an impact, as the deputy chairman made contact with our lobbyist who agreed to sit down and hear our case for greater involvement,” Hayden said.

“The meeting was completed last week with a commitment from the ARNECC Deputy Chairman to confirm in writing that these changes do not apply to finance brokers. This is a real win for the profession and we will share that letter with the broker industry once received so that you can keep this on file should it be necessary.”


  • by Concerned Member 25/08/2015 9:17:33 AM

    So let me get this right, an issue that was only going to effect less than 1% of brokers if that, the MFAA engages a lobbyist with their members $ for a cause that was going no where as it was.....

    As a member I have to say I am surprised at the lack of concern on how my membership money is being spent, I really don't think a Lobbyist is something we need right now considering Ms Hayden's employment with the MFAA was taken on the point that SHE would be working with government bodies and lobbying on behalf of us the members.

    Personally I think our membership money is better spent on PD Days, Information Breakfasts / Lunches and Broker Development Lobbying a cause that has little or no effect to Industry is just a pure waste of members money!.

    Peter White was right in everything he said in his article, Maybe Ms Hayden should have listened to what he had to say on this one.

  • by Steve McClure 25/08/2015 10:14:25 AM

    Concerned Member, of course you have the right to question how your money is spent. However, in Feb 2015, Gadens Solicitors website published John Denovan's learned opinion that if proposed legislation was not changed, brokers may require PI of $20 Mill or be excluded from conducting VOI. He repeated this in Jun 2015 on an industry site.

    The MFAA couldn't ignore it and allow brokers to be burdened in that way. They were proactive.

    And, while doing that, they also continued to conduct PD days, one of which I attended just last week. Very well attended, with brokers praising the valuable content.

  • by SouthBris Broker 26/08/2015 10:39:06 AM

    Dear Concerned. If it is 1% or 80% of brokers that are impacted the Ass. should represent all of the brokers. Well done MFAA for at least checking and not leaving some brokers out in the cold like it was suggested by Peter White. Regulators are not to be trusted when it comes to our industry and without this action we would have no voice.