Owner Builder Indemnity Insurance DOUBLES!

In Owner Builder Latest News by Underwriter

Owner Builder Home Indemnity Insurance doubles, therefore it will increase to a $200,000.00 maximum payout from December 1st.

The W.A Government has increased the potential payout from $100,000.000 to $200,000.00 in line with increasing Labour and Materials costs.

While the increase is below Victoria’s $300,000.00 and NSW $340,000.00, the increase is a welcome addition to what is a huge increase in building costs to compensate a purchaser in the event of an Owner Builder dying, disappearing, or become insolvent and the Purchaser being left to pay the costs of rectification of defects relating to the Owner Builder work.

Commerce Minister Roger Cook said, “Improved Indemnity Insurance will give prospective home buyers the peace of mind knowing that if things do go wrong there will be a much better safety net.”

Quoted from the Building Commission website:

As an Owner Builder, “If you sell your home within seven years from the date of a building licence or permit being issued, you are required under the Home Building Contracts Act 1991 to have in place a policy of Home Indemnity Insurance which covers subsequent owners if problems with the building develop, and the Owner Builder fails to rectify faulty or unsatisfactory workmanship due to Disappearance, death, or insolvency.

The Home Indemnity Insurance policy must cover the purchaser of the home and subsequent owners for the remainder of the seven-year period.

All residential building work valued over $20,000.00 must be covered by Home Indemnity Insurance, however Home Indemnity Insurance is not required for ‘associated work’, such as building only a pergola, fence, or swimming pool.

The prospective purchaser should be provided with a valid certificate of insurance before the sale contract is finalised. Failure to do so can lead to prosecution and a $10,000.00 fine. If Home Indemnity Insurance cannot be obtained, the property cannot be sold within seven years of obtaining the building permit.

Owner Builder Home Indemnity Insurance doubles, so get Indemnity Insurance today with AOBIS.