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Home building compensation scheme update

Posted by Fair Trading NSW on 18 June 2018

From 1 July, the cost of home building compensation (HBC) cover formerly known as home warranty insurance needs to be disclosed in contracts for residential building work over $20,000.

The 'cost of cover' must be the total amount you paid for the HBC cover, or a reasonable estimate of what it will cost, including brokerage costs, fees and taxes. If you want to charge a margin for arranging the cover, you cannot include it in the 'cost of cover' line item. You must include it elsewhere in the contract.

NSW Fair Trading is updating the standard contract template for building or trade work over $20,000 and the Consumer Building Guide to reflect the changes.

More information about HBC requirements is available from the State Insurance Regulatory Authority website.

Author: Fair Trading NSW
Tags: Industry News

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