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Builder's Warranty insurance is a legislative requirement in most states of Australia. This insurance policy is purchased on behalf of a homeowner by the contracted licensed builder. A Builder’s Warranty insurance policy is required when a contract for residential works is valued greater than $12,000.

Builder's Warranty insurance is required for works on residential properties only. These works may take the form of construction of a new dwelling, or alterations and additions, both structural and non-structural to an existing dwelling.

The policy protects the homeowner against non-completion of the residential project or defective works when the contracted builder has died, disappeared, been declared bankrupt or insolvent.

The legislative requirements of Builder's Warranty insurance vary from state to state. Generally speaking, a Builder’s Warranty insurance policy is to be in place prior to the builder taking a deposit or commencing any works.

In order to obtain an insurance policy, a builder must first secure eligibility for a Builder’s Warranty insurance facility with the insurer. This involves an underwriting process where the insurer will assess both the financial strength of the building entity and its experience and skill as a builder.

Once the facility is in place, individual policy applications can be submitted.

Builder's Warranty: What We Think

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