With one in ten real estate professionals lodging a claim every year against their insurance company, the principal’s responsibilities in managing the safety of their tenants has changed significantly over the past decade. This is according to the founder of PropertySafe, Phil Oakes, who was recently interviewed in Residential Property Manager.
“Whereas the previous inspections that agents did were just for the condition of the property, now it’s really about the safety.” Mr Oakes commented. This is because there are now major ramifications if known or unknown issues result in tenant injury.
Mr Oakes notes that when it comes to exposure for agencies, “Claims can significantly exceed their cover from professional indemnity insurance, which would place their business at risk. But more important is the risk to their reputation.”
With this in mind, RP Data has recently formed an alliance with PropertySafe to provide a comprehensive risk management approach. It is specifically designed to help protect and retain the value of an agency’s key asset, the rent roll.
Although it has long since been established that landlords owe tenants a duty of care in respect of defects in rented property, recently the Courts have found that real estate agents also owe a duty of care to warn the tenant and/or the landlord of any dangerous defects in the premises of which they are, or ought to be aware of.
These findings create a significant risk exposure for all Principals in terms of potential claims against them, reputational damage in the event of a claim, and the possibility of agents not being covered by their professional indemnity insurance.
PropertySafe is a comprehensive safety inspection and reporting system that can save property managers countless hours of work and agencies thousands of dollars in operational costs per year.
“By using PropertySafe, homes are thoroughly checked by inspectors for any risk issues and a report, that indentifies any risks and makes recommendations based on the urgency of the issue, is delivered to the client,” Mr Oakes noted.
Furthermore Mr Oakes has found that the minimisation of risk can also deliver higher rental returns and enhance the reputation of an agency.
“If your property does get inspected and it’s safe-certified, it’ll be more desirable to tenants, so the returns for the investor and the agent will also be increased,” Mr Oakes concluded.
For more information on PropertySafe call 1300 895 015 or email firstname.lastname@example.org
Source: Residential Property Manager.