Builders and tradespeople need to obtain home building compensation (HBC) cover – formerly known as home warranty insurance’ for residential building work in NSW costing more than $20,000 including GST, unless exempt.
HBC cover is required for new home constructions (including multi-unit buildings of three storeys or less) or home renovations. Failing to have home building compensation cover continues to be an offence under NSW law.
You’ll need to get HBC cover if you are contracting directly with the homeowner or owner-builder permit holder for the work.
Proof of HBC cover needs to be given to the homeowner before you start work or request any payment, including a deposit.
From 1 July 2018, you must disclose the cost of the HBC cover in your contract with a homeowner. This will ensure that the cost is clear to the homeowner when entering into the contract.
How to get HBC cover
HBC cover is currently available from a single monopoly provider operated by the NSW Government, icare hbcf. There are a number of brokers that sell the icare’s HBC product. In future you may have the choice to buy different products from different providers.
Any other insurers or providers licensed by SIRA will be able to operate in the NSW HBC market.
Eligibility for HBC cover
If you’re a builder not satisfied with the decision regarding your eligibility outcome, you can request a review.
There are new guidelines for eligibility under the reformed HBC scheme from 1 January 2018.