Building indemnity insurance requirements

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Where a construction project is performed, or to be performed, by a building work contractor or on the contractors own behalf, building indemnity insurance is required to be taken out on all domestic building work contracts valued at more than $12,000 (and where development approval is required). 

Section 34 of the Building Work Contractors Act 1995 (SA) compels builders carrying out domestic building work to hold a policy of insurance in relation to that work. A copy of the building indemnity insurance certificate must be supplied to council at the commencement notification before works begin.

Building indemnity insurance covers a building owner for defective building work up to an amount of $150,000 in cases where the builder dies, disappears (or is otherwise unable to complete the work or becomes insolvent.

Home owners can check whether builders indemnity insurance has been taken out for a particular address from the QBE website.

Licensed builders may apply for exemption from taking out builders indemnity insurance from Consumer and Business Services in exceptional circumstance. To apply for the exemption, visit the consumer and business services page here.