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Home Warranty Insurance | Master Builders Insurance Brokers
Home Building Compensation Fund
Providing protection for your valued customers.
Cover for
Incomplete or defective works
Mandatory threshold
Value of work is over $20,000
Cover conditions
Death
Disappearance
Insolvency
What is the Home Building Compensation Fund?
The Home Building Compensation Fund (HBCF) is a statutory product, compulsory under relevant building legislation in New South Wales for builders carrying out residential building work.
The Home Building Compensation Fund, or Home Warranty Insurance as it is referred to nationally, covers the homeowner (and subsequent owners) where the contracted building work is incomplete or defective. The insurance responds when the builder has either died, disappeared, become insolvent during construction or the builder’s licence has been suspended due to non-compliance with an order of the court or NCAT.
The cover lasts up to 6 years from completion of the domestic building work or termination of the domestic building contract (12 months for non-completion, 6 years for major defects and 2 years for other loss or damage). Cover is provided only for outcomes relative to a specific dispute resolution process.
In November 2016, icare (Insurance & Care NSW) made an announcement outlining reforms to the Home Building Compensation Fund (HBCF) to ensure its financial sustainability and ability to protect homeowners now and into the future.
Registered builders in NSW seeking to purchase insurance from icare must select a licensed Distributor to manage their HBCF needs.
We one of only 9 brokers to have been granted a license to act as a Distributor of icare.
MBIB has many years experience in dealing with the underwriters of HBCF in New South Wales and has a designated team that are well placed to assist both new and existing builders through the eligibility and review processes.
HBCF is subject to legislation change at any time. For the latest updates visit our dedicated HBCF website or for more information, visit the NSW government websites:
Not in NSW? Please select your state: Victoria | South Australia | Western Australia | Australian Capital Territory | Tasmania | Northern Territory | Queensland
Our Eligibility team is unique within the market.
Our Eligibility team is responsible for assisting you with initial eligibility applications and ongoing eligibility reviews, as well as attending to your general queries about HBCF.
We are committed to providing you with a comprehensive service, ensuring that all eligibility enquiries actioned are within our service standards. We also conduct pre-submission quality assurance reviews to guarantee that all eligibility review submissions meet the requirements of the various states and territories.
Our recruitment for eligibility personnel focuses on financial literacy and experience, rather than just a general insurance background. We seek degree qualified, skilled professionals with experience in insolvency, accounting and finance.
This allows us to have effective conversations with you and your appointed accountants or financial advisors, so that we achieve quality and realistic outcomes for you.
We take a proactive approach that often involves an education element (for you and your accountant or financial advisor) to ensure you understand the HBCF process. We advise how you can position your business to balance your responsibilities under your state-specific scheme and your future plans for your business.
Why do you need our specialist advice?
Here's an example:
We received a job specific application from an NSW builder that, when processed, would put them 10% above their available open job limit.
On further investigation, we determined that the insufficient available limit was more of a timing issue due to delays on current projects.
Often in the building industry jobs are delayed due to council approval timeframes blowing out or projects being almost finished but not quite at practical completion (the stage at which the builder can then close the job off).
Working with the builder, we were able to provide the Insurer with a detailed explanation of what stage each outstanding project was at. Once home warranty is obtained, it can take 4-6 weeks to get the permit from the certifier. The Insurer approved the project based on the explanation provided because they could see and understand how the new project would overlap with outstanding projects.
This positive outcome ensured that the builder was able to keep working without having a 4-week gap until their next project.
Advice from our experts:
To provide homeowners with the correct Home Warranty cover, builders should vary a job specific policy when the contract value increases.
You need to let us know if the contract value increases more than 10% for Victorian certificates from the original contract price or more than 20% for certificates issued in NSW.
Sonia Kerr National Home Warranty Operations Manager
Home Warranty eligibility is a complex product and every builder’s business is different. With our expert knowledge and advice, we will help you navigate the complexities to get the best outcome possible for your business.
Sonia Kerr National Home Warranty Operations Manager
Before making any changes to your trading structure, contact one of our eligibility experts who will be able to advise you of the likely impacts on your eligibility facility. It could save you headaches later on.
To avoid problems later, a Home Warranty policy should always be taken out prior to any works starting.
Sonia Kerr National Home Warranty Operations Manager
Home warranty eligibility reviews can be stressful. To help make it easier, use our team’s expert knowledge – we can work directly with your accountant freeing up your time to focus on what you do best.
Why choose Master Builders Insurance Brokers?
Australia's Best Builders Choose MBIB
