You can only claim on the insurance if the contractor has died, disappeared or become insolvent. If none of those things has happened, you will need to attempt to enforce your statutory warranty rights against the contractor to have them complete or rectify the building work or compensate you for the loss.
Steps you can take to enforce the statutory warranty include:
- notifying the builder or tradesperson in writing to tell them what the problem is and what you want them to do (you should do this without delay and within six months of becoming aware of any problem with the work).
- lodging a complaint with NSW Fair Trading,
- lodging a building claim with the NSW Civil & Administrative Tribunal (NCAT), and/or
- starting District Court proceedings against the builder or tradesperson
Can’t find the builder or tradesperson
If you can’t locate the builder or tradesperson, lodge a complaint with NSW Fair Trading. They will conduct their own searches and if unable to find them, they’ll issue you a letter saying the builder or tradesperson can’t be found.
You can then use this letter when making a claim to an insurance agent/insurer. It can be accepted as evidence that you believe the builder/tradesperson has disappeared and you’ve made all efforts to locate them.