Calling on the WA Government to step in and immediately update the outdated Builders Indemnity Insurance to protect new building and home renovation customers and increase the maximum QBE policy pay out to the total value of the contract.

Western Australia has one of the lowest builders warranty / indemnity policy coverage in Australia. With 2 builders entering liquidation within days of each other, and many more on the brink of bankruptcy due to Ill timed government grants, Covid 19 pandemic and the soaring costs of materials and labour, the government needs to step in and fix the policy in which they started and also receive 10% of premiums for. 

Hundreds of new build customers whose builders have gone into liquidation in the last few days are facing financial ruin, homelessness and mental health breakdowns through no fault of their own.

The current WA regulated QBE Builders Indemnity insurance is capped at a maximum payout of up to $100,000 less $500 excess, but with the soaring costs to build in today’s inflated building market it means customers are facing hundreds of thousands of dollars out of pocket and the inability to finish their home they have poured their life savings into.

Despite the BII premium calculated and paid by the homeowner based on the cost of the build contract, which is also stated on the certificate of insurance, unbeknownst to many the maximum pay out is up to $99,500 regardless of contract amount. Adding that many builders front end load progress payments which doesn’t always match the work carried out to date before liquidation, customers are left with no protection for their biggest asset purchase. 

In today’s inflated market, many builders are asking for payments of thousands of dollars simply just to quote which is a requirement by QBE and adds further financial stress, especially as 2-3 quotes are required to proceed with the claim.  

We are calling on premier Mark McGowan and deputy premier Minister Roger Cook, to review and update the WA Builders Indemnity insurance policy to cover and pay out up to the total value of the build contract as a matter of urgency and protect new build and home renovation customers who have done the right thing but have been let down by archaic policies and contracts that favour the builder.

An amendment of the policy to also include builders that have had their licence suspended due to non-compliance with an order by the WA State Administrative Tribunal or court to pay the homeowner money.