Types of Insurance Policies for Builders
Public Liability Insurance
Public liability insurance is a type of insurance policy that protects builders against claims made by third parties for property damage or bodily injury caused by their work. It covers the cost of compensation payments, as well as any related expenses. Public liability insurance is essential for builders as it provides financial protection against potential claims that can arise from accidents or injuries on the construction site.
Home Warranty Insurance
Home warranty insurance is mandatory in NSW for any residential building work exceeding $20,000. It provides coverage for homeowners against losses resulting from incomplete or defective works, where the builder dies, disappears, becomes insolvent, etc. Builders must provide a certificate of insurance to the homeowner before starting any work.
Workers' Compensation Insurance
Contract Works Insurance
How to Choose the Right Insurance Policy for Builders
When choosing insurance policies for builders in NSW, there are several factors to consider, such as the scope of work, the size of the project, and the level of risk involved. To choose the right insurance policy, builders should consider the coverage and benefits of each policy and compare them with their specific needs and budget. It is also important to seek professional advice from insurance brokers or construction lawyers to ensure that they are adequately protected. Other tips for choosing the right insurance policy for builders include reviewing the policy wording carefully, understanding the exclusions and limitations, and considering the insurer’s reputation and financial stability. By carefully evaluating their options, builders can choose the insurance policies that provide the best coverage for their business and give them peace of mind.
Key Takeaways
Securing the right insurance policies is crucial for builders in NSW to protect themselves and their clients. Public liability insurance, home warranty insurance, workers’ compensation insurance, and contract works insurance are essential policies that builders should consider. When choosing the right insurance policies, factors such as coverage, costs, and reputability of the insurance provider must be considered. Seeking professional advice is also highly recommended to ensure the builder has the appropriate coverage. As a construction lawyer with extensive experience in NSW, I highly recommend that builders take the necessary steps to protect themselves and their clients by securing the appropriate insurance policies.
As a final thought, homeowners should not overlook the importance of verifying a builder’s insurance coverage before commencing any work on their property. This can help protect against any unforeseen incidents that may arise during construction. Additionally, homeowners should request and compare builder quotes before selecting a builder to ensure they are getting the best value for their money.
Download our “Builder Licence and Insurance Verification Checklist” to ensure you are asking the right questions and selecting a reputable builder. As a solicitor and construction lawyer with over 10 years of experience in construction law, I have developed this checklist to help homeowners navigate the often-complicated process of selecting a builder.
