Best Building Indemnity Insurance For Your Business
Australia is a rapidly growing nation, with cities such as Sydney and Melbourne seeing growth rates that are rarely seen in other developed countries. Due to this rapid growth, the construction and building industry is booming. Throughout the country, there are hundreds of different new developments, big and small, that are either being planned or are currently underway. Due to this market climate, it’s critical that any Australian involved in construction and building environments understands the importance of building indemnity insurance.
What Does Building Indemnity Insurance Cover?
Building indemnity cover, which can also be called builders warranty insurance depending on the state, is required by law in all Australian states except for Tasmania and the Northern Territory. Anyone involved with a building project should first be aware of the specifics surrounding the law in their state. Differing states will have different minimum value thresholds for when this type of cover has to be taken out. For example, in South Australia, any work valued over $12,000 must include indemnity insurance.
Building indemnity covers a wide range of different scenarios which many people active in the construction industry know to be a reasonable risk. Building contracts are always prone to a significant number of risks, especially when it comes to small-scale contracts which may involve only a small amount of local builders. Considering that many smaller building projects are funded by individuals and families, it is critical that this type of cover is taken out whenever a project is set to be commenced.
The most basic cover that building indemnity insurance covers are non-completion, including any losses incurred through the lost deposit. It is not unheard of in Australia for certain low-quality builders to completely abandon any projects that they have been contracted to complete. Throughout the country, many project managers can be shocked to find that the builders that they have hired no longer show up to complete the project and have disappeared with the deposit that they initially provided. In cases such as this, all losses including the deposit will be reimbursed through the indemnity insurance scheme.
On a more specific level, builders warranty insurance also covers any lack of workmanship or neglect on the part of the builders contracted. The law recognises that there is a given level of trust provided by individuals hiring builders. Hence, if the builders hired to provide a low-quality job, which is clearly not up to any standards that are to be expected in the market, indemnity insurance will cover the loss. Recently, developments in urban areas, such as apartments which have been created at a level of workmanship that is significantly below the standard expected would have been covered by this type of insurance.
Furthermore, any other occurrences which cannot be foreseen, such as the insolvency of the building company or the death of the builder leading to incompletion, is compensated through this type of cover.
Who Can Take Out Builders Warranty Insurance?
All states in Australia with builders warranty legislation in force will require the building work contractor to take out the insurance. Only the building work contractor is legally bound to take out this type of insurance, making it simple for all parties involved. It is worth noting that states with building indemnity legislation have made it illegal for any work to be commenced without insurance being taken out.
The building work contractor will need to ensure that they have an up to date building license in order to go through with the application process.
How Do I Apply For Building Indemnity Insurance?
Considering that no work can be completed in most states without this type of insurance, the application process for building indemnity cover is straightforward. As mentioned, so long as the building work contractor holds a valid and up to date building license, they will only have to provide a copy of this license as well as some other documents in order to complete the application process.
Along with a copy of the building license, statement of financial position such as that of assets and liabilities along with tax documentation and rates notices are required during application. Most building contractors will already have these documents available as they are often needed for various other aspects of work as a builder. Hence, the entire process is relatively hassle-free.
Get Building Indemnity Insurance Today
Builders warranty insurance is a necessary legal requirement for most states in Australia. Because of this, it is essential that all building contractors take out this cover as soon as possible for any projects which they are looking to commence. As detailed, the process of application for getting this insurance is very straight forward and can be done quickly with the assistance of a high-quality insurance provider.
There are plenty of great insurance providers that provide building indemnity cover. Those looking to get the most pertinent advice surrounding the most suitable indemnity cover for their circumstances should call us for a quotation today!
