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REIQ Journal : August 2008
2 Industry News Become an Aon distributor Keep your clients covered Since the introduction of the Financial Services Reform Act 2004, it is illegal to provide financial advice or make recommendations about insurance policies without an Australian Financial Services Licence. Legal Profession Act Special conditions for REIQ residential sales contracts and property management agreements are now available on Realworks. As advised in previous Memberlink and Journal communications, amendments to the Legal Profession Act 2007 came into effect on 1 July 2008. The Act now provides that a PAMD Act licensee and their employees are not considered to be engaging in legal practice simply because they provide, prepare or complete a property contract as part of their normal work under the Property Agents and Motor Dealers Act. To help members comply with the amended provisions, the REIQ engaged legal professionals to prepare a suite of commonly used special conditions for use in residential sales contracts and property management agreements. The special conditions are available to Realworks subscribers as a downloadable file which can be imported into your Realworks software. Visit www.realworks.com.au/ specialconditions.asp to access the service. New REIQ Best Practice form - Acknowledgement of Special Conditions (EF022) To help agents comply with the Legal Profession Act 2007 it is recommended that each party to the contract sign an acknowledgement when a special condition prepared by an Australian legal practitioner has been used. Realworks subscribers should synchronise their Realworks software to obtain the new form. But, with a new set of easy-to-follow guidelines, it is now possible for real estate agents to become distributors of home and contents insurance and rental protection policies. According to Aon’s divisional manager Peter Lynch, an agent can become an insurance distributor by signing a simple agreement. “There are clear guidelines for talking to clients about insurance under the agreement, which allows agents to provide factual information without giving opinions or advice,” he said. Agents must also hand out a one-page explanation notice about what it means for the agent to be a distributor, and ask their clients to read the relevant Product Disclosure Statement. Benefits for property managers Better service By providing landlords with a set of policies for rental protection, the property manager can take some of the hassle out of insurance. Peace of mind By providing a rental insurance policy for a landlord, the property manager knows for certain that their landlord is protected. Additional source of revenue Agencies can choose to receive commission on the policies they sell. You must disclose to your client that you receive commission from acting as a distributor. REIQ REALWORKS Realworks. The trusted name in forms. On Wednesday 13 August REIQ’s head office in Brisbane will be closed for the RNA Show holiday. However, Realworks support will be available during the regular business hours of 8:30am to 5pm by phoning (07) 3249 7350 or emailing firstname.lastname@example.org Protection for tenants Tenants often don’t realise they are responsible for insuring their contents against damage or theft. Property managers can explain to new tenants that it would be prudent to take out insurance for their contents. As an Aon distributor, you could go one step further and have Aon’s TenantSURE policy ready at hand. Benefits to sales agents Sales agents can also distribute Aon insurance products, such as home and contents insurance for their buyers and sellers. This can significantly reduce the hassle of insurance for the client and provide an additional source of income for the agent. To find out more about becoming a distributor, log on to www.aon.com.au/realestate or contact Molly Walsh on (07) 3223 7543 or email@example.com REIQ Journal August 2008