The Minister for Innovation and Better Regulation Victor Dominello has announced that from 4 August 2015, eligible residential builders will be able to apply for additional insurance on ‘an open job and contract value limits’ basis under the Home Building Compensation Fund (formerly the Home Warranty Insurance Scheme) for residential building projects over $20,000.
As the Home Building Compensation Fund system currently stands, builders have been subject to a capped amount of available insurance each year. This maximum cap system is widely viewed as too restrictive on builders, hindering their ability to grow their business. The move is designed to increase flexibility for builders to access sufficient coverage under the Home Building Compensation Fund , and in doing so, carry out more projects in a single year.
The changes will also include the implementation of a cloud-based IT register containing important insurance and home warranty information as part of the drive to greater transparency for consumers and builders alike.
The changes will likely require builders to provide additional information regarding live projects, but otherwise the new criteria will make it easier to access cover for new work, which should provide some welcome relief.