Builder Warranty Insurance by State: Developer Guide

Builder warranty insurance is a statutory, last-resort cover that every Australian state and territory handles differently, and the differences are large enough to change a project’s cost line, its builder shortlist and its defect exposure. The threshold that triggers cover ranges from work over $3,300 in Queensland, inclusive of goods and services tax (GST), to work over $25,000 in the Northern Territory. The sum insured ranges from a published $100,000 in Western Australia to at least $340,000 in New South Wales. One feature is close to universal, and it is the one that matters most to anyone building apartments: in most jurisdictions the cover stops at three storeys.

Before considering how builder warranty insurance affects a project, you’ll need professional advice from a construction lawyer and a licensed insurance adviser. The obligation to hold cover generally sits with the builder, but the consequences of getting it wrong tend to land on the developer: a certificate that cannot be issued can stall a building commencement notice or an occupation certificate, a builder who cannot obtain cover cannot be awarded the contract, and a purchaser of completed stock inherits both the cover and the statutory warranties whether or not anyone explained that at exchange. Both are worth involving early: a construction lawyer while the building contract is still in draft and before any deposit is taken, and an insurance adviser before a certificate is relied on in a project file. This guide is written to make that conversation shorter and sharper. It does not answer it.

Figures, thresholds and claim periods in this guide were current at the date of writing and move regularly, often with little notice and sometimes with staged commencement. Several changed in 2025 and 2026 alone. Each section links the government or legislative source, and that source is the place to confirm a number before it goes into a contract or a feasibility.

What is builder warranty insurance, and what does it actually cover?

Builder warranty insurance is a last-resort cover that responds when a residential builder cannot. It generally does not respond while the builder is solvent and contactable, which is the single most common misunderstanding about it.

The schemes go by different names. New South Wales calls it home building compensation cover, Victoria calls it domestic building insurance, Queensland runs the Queensland Home Warranty Scheme, Western Australia calls it home indemnity insurance, South Australia calls it building indemnity insurance, and the Northern Territory issues a fidelity fund certificate. The commercial market tends to call all of them home warranty insurance or builders warranty insurance. They are not the same product, and reading a Victorian explanation of a New South Wales obligation is a reliable way to get a threshold wrong.

What they have in common is the trigger. Cover typically responds where the builder has died, disappeared, become insolvent, or in some jurisdictions had their licence cancelled. Where the builder is still trading, the owner’s remedy generally runs through the statutory warranties and the dispute process rather than the policy. For a developer that distinction has a practical consequence: the policy is not a substitute for a defects liability regime in the building contract, and it may be worth treating the two as separate lines of protection with different triggers.

The other shared feature is that cover is typically purchased by the builder, named in favour of the owner, and assignable to subsequent owners. The developer is usually not the insured party, and may not be a party to the policy at all, which is why the certificate rather than the policy is what tends to end up in the project file.

Which builder warranty insurance scheme applies in each state and territory?

Every jurisdiction operates its own scheme under its own Act, with its own threshold, sum insured and claim window. The table below is a starting point for comparison, not a substitute for the linked source in each section.

New South Wales: what triggers home building compensation cover?

Cover is required in New South Wales where the contract price or market cost of labour and materials is over $20,000 including GST. Service NSW states that a builder must hold home building compensation cover of at least $340,000 before starting any work or taking any money, and that the certificate of insurance must go to the home owner before a deposit is taken or work starts. The scheme is set up under Part 6 of the Home Building Act 1989 (NSW).

The warranty periods that sit alongside the cover come from section 18E of that Act: six years for a breach resulting in a major defect, and two years for any other breach, running from completion of the work. Section 18E defines a major defect by reference to a “major element” of the building, which the Act describes as covering load-bearing components, fire safety systems and waterproofing, among others. That definition does a lot of work in practice, because whether a given defect is major or not decides whether the owner has six years or two.

New South Wales is covered in far more detail in the dedicated NSW home warranty insurance guide, including the exemption categories, builder eligibility limits and premium mechanics. The national picture is the subject here.

Source: Service NSW, apply for home building compensation cover.

Victoria: what does domestic building insurance cover, and who provides it now?

Consumer Affairs Victoria states that domestic building insurance is taken out by the builder “for your client on works over $16,000”, and that it “covers costs up to $300,000 to fix structural defects for six years, and non-structural defects for two years”. The claim trigger is narrow: the cover responds where, before the work is complete, the builder dies, becomes insolvent or disappears.

Two points may matter to a developer working in Victoria. The first is the provider. Consumer Affairs Victoria now names the Building and Plumbing Commission as the body that provides domestic building insurance in Victoria. Material published earlier refers to the Victorian Managed Insurance Authority, so a certificate sitting in an older project file may name either, and a due diligence checklist written a year ago may point at the wrong portal.

The second is the $300,000 cap read against current construction costs. On a townhouse product where the all-in cost of a single dwelling sits well above that figure, the cap is not a proxy for rectification cost. It is a cap. A reader working out how much residual risk sits outside it may find the arithmetic more useful than the headline.

Source: Consumer Affairs Victoria, domestic building insurance.

Queensland: why is the threshold so much lower?

Queensland’s threshold is the lowest in the country. The Queensland Building and Construction Commission states that insurance is compulsory for residential construction work valued at more than $3,300 including materials, labour and GST, and that the premium is collected by the contractor from the owner, included in the contract, and paid to the Commission before work begins.

The cover limit is $200,000 for each of three categories: refunding a deposit or finishing incomplete work, repairing damage to incomplete works from fire, storm or tempest, and fixing defects and subsidence after completion. Within that limit there is a $5,000 sub-limit for alternative accommodation, removal and storage. The Commission also publishes an option for the owner to purchase additional cover lifting the limit to $300,000, with a $10,000 sub-limit for those ancillary expenses.

The claim windows are tighter than most readers expect, and they are where entitlements are generally lost. The Commission’s published position is that a non-completion claim must be lodged within three months of the contract ending; that a structural defect claim must be lodged within three months of noticing the defect, inside a cover period of six years and six months; and that a non-structural defect must be noticed within six months of completion with the claim lodged within seven months. A six-month non-structural window is short enough that handover inspection discipline, rather than the policy, is doing most of the protecting.

Queensland also draws the storey line explicitly. The Commission states that building work carried out in or for a multiple dwelling of more than three storeys, not counting one storey if it comprises mainly a carpark, is not residential construction work and is therefore not insurable.

Sources: Queensland Building and Construction Commission, what is home warranty insurance, maximum amounts covered and understanding the scheme.

Western Australia: what does home indemnity insurance require?

Western Australia requires home indemnity insurance for residential building work above $20,000. The state government’s published reminder to builders states that cover must be in place “before claiming any payment from the owners or commencing work”, and that an owner-builder who intends to sell within seven years of the building permit being granted must also hold it.

Published Western Australian guidance on the Home Building Contracts Act 1991 (WA) sets the cover at up to $20,000 for loss of deposit and up to $100,000 for completion or rectification of the building work, available within six years from the date of practical completion. Associated work on its own, such as a pool, carport, pergola or landscaping, sits outside the requirement, but is drawn back in where it forms part of a contract that also includes residential construction and the total exceeds $20,000.

The $100,000 figure is the lowest published sum insured of any mainland scheme, and it was set a long time before current construction costs. For a developer comparing jurisdictions, Western Australia is the clearest case where the cover should probably be read as a partial backstop rather than a rectification budget.

Source: Government of Western Australia, home indemnity insurance obligations.

South Australia: which threshold and cap apply to a policy issued now?

South Australia changed both numbers recently, and which figures apply depends on when the policy was issued rather than when the question is asked.

The South Australian Government Financing Authority publishes the threshold as $20,000 or greater, having increased from $12,000 on 10 November 2025, and sets out the maximum cover in tiers by policy issue date: $80,000 for policies issued between 1 July 2013 and 30 June 2017, $150,000 from 1 July 2017 to 30 September 2025, and $250,000 for policies issued from 1 October 2025. The South Australian Government’s consumer page, updated in February 2026, states the requirement as applying to domestic building work that requires council approval and costs $20,000 or more, consistent with the higher threshold having taken effect.

On claim periods, the government page states that defective work claims “can usually be made up to 5 years from the date the building work was completed”, which is a shorter defect tail than the six years common elsewhere. South Australia also states that an owner carrying out the work themselves cannot take out the cover at all, which matters for anyone contemplating an owner-builder structure on a development site.

Sources: SA.GOV.AU, building indemnity insurance and South Australian Government Financing Authority, building indemnity insurance.

Tasmania: is there a scheme yet?

Tasmania legislated a home warranty insurance scheme in 2023, and the commencement of that scheme is the item most worth confirming directly rather than taking from any secondary source, including this one.

The Residential Building (Home Warranty Insurance Amendments) Act 2023 (Tas) provides at section 2 that its provisions “commence on a day or days to be proclaimed”. The substantive obligation is at section 77C(1): a building contractor must not enter into a residential building work contract for insurable work without a certificate of insurance. Section 77G(1) requires the policy to indemnify owners and subsequent owners for non-completion, breach of statutory warranty and defective work where the contractor is unable to be contacted, bankrupt or insolvent. Section 77G(3)(c) sets the minimum cover at the lesser of “$200 000 or such other amount as is prescribed” and twenty per cent of the total contract price, and section 77G(3)(b) requires the policy to stay in force for at least six years after practical completion or contract termination. Section 77B carves out State authorities, Homes Tasmania, pool-only construction and prescribed building classes.

The Tasmanian Government announced in August 2024 that the scheme would apply to residential building contracts over $20,000, would be government-underwritten with a private provider, and was expected to start in mid-2025, with the tender for providers closing in October 2024. Whether the proclamation has since been made, and on what terms the scheme is now operating, is a question for Consumer, Building and Occupational Services rather than for any published summary. A developer contracting in Tasmania may want that confirmed in writing before relying on either the presence or the absence of the obligation.

Sources: Residential Building (Home Warranty Insurance Amendments) Act 2023 (Tas) and the Tasmanian Government announcement.

Australian Capital Territory: what changed in 2025?

The Australian Capital Territory lifted its minimum sum insured substantially. ACT Government material on residential building work insurance states that “from 1 January 2025, the minimum insurance amount will be increased from $85,000 to $200,000”, and that the time limit to lodge a claim increased from 90 days to 180 days. Cover is required for houses and apartment buildings of three storeys and below, not counting a car park, and the builder must obtain it before applying to the certifier for a building commencement notice and starting work.

The increase is a useful example of why a figure needs checking against the certificate rather than against a web page. Other ACT Government pages still reference residential building insurance “for a maximum of $85,000 of insurable building work”, so two official pages can disagree while one of them is simply yet to be updated. The sum insured stated on the certificate is the operative number.

The statutory warranties sit separately. The ACT Government states that structural elements, including external walls and weatherproofing, carry a six-year warranty from the completion day and non-structural elements two years, that the warranty is taken to be contained in every residential building work contract to which the builder is a party, that the threshold is approval-triggered residential building work costing $12,000 or more, and that a purchaser within the warranty period is entitled to the remainder of it.

Sources: ACT Planning, residential building work insurance and statutory warranties.

Northern Territory: what does a fidelity fund certificate do?

The Northern Territory runs a fidelity fund rather than a conventional insurance scheme, and its threshold changed in 2026. The Northern Territory Government states that the minimum prescribed value triggering a fidelity certificate requirement is $25,000, increased from $12,000 as of 30 March 2026.

Prescribed residential building work covers new houses and duplexes, units in complexes up to three storeys excluding undercroft or underground parking, renovations and extensions to those buildings, and building work worth over $25,000 that increases residential floor area. The certificate covers costs associated with transitioning to a new builder to complete the work, non-structural defects for one year after completion, and structural defects for six years after completion. Prefabricated houses, buildings greater than three storeys, sheds, fences, standalone retaining walls and standalone bathroom renovations sit outside the requirement. A registered builder obtains the certificate for prescribed work, and an owner-builder needs one to protect future owners after a sale.

The one-year non-structural period is the shortest of any Australian jurisdiction, which puts more weight on the defects liability period negotiated in the building contract than on the certificate.

Sources: Northern Territory Government, fidelity fund certificate and residential building insurance.

Why does builder warranty insurance stop at three storeys?

In most Australian jurisdictions, residential buildings above three storeys fall outside the warranty insurance scheme entirely, and that is the structural feature a developer of apartment product may want to understand before anything else in this guide.

Queensland states it plainly: work in or for a multiple dwelling of more than three storeys, not counting one storey used mainly as a carpark, is not insurable under the scheme. The Australian Capital Territory frames the requirement as applying to houses and apartment buildings of three storeys and below. The Northern Territory excludes buildings greater than three storeys from prescribed work. New South Wales draws the same line from the other direction through its bond scheme, which the NSW Planning Portal describes as applying where the building has four or more storeys, with buildings of fewer than four storeys remaining covered by the Home Building Compensation Fund instead.

The consequence is counterintuitive. The product with the largest defect exposure, the highest rectification cost and the most owners with standing to complain is generally the product with no warranty insurance behind it. The schemes were designed around detached housing, and the insurance market for multi-storey residential defect risk has never been a scheme market.

What fills the gap varies, and in two states it is now a bond lodged by the developer rather than a policy taken out by the builder.

New South Wales: the strata building bond

The NSW Planning Portal states that a developer must pay a building bond to NSW Fair Trading equal to 2 per cent of the building contract price, lodged before an application is made for the occupation certificate, where the building has four or more storeys, will be used for residential purposes, and the building contract was entered into on or after 1 January 2018.

The bond is not a cost in the ordinary sense. It is refundable, and it is released after an inspection cycle. The NSW Government describes a building inspector appointed within 12 months of the building work being finished, an interim inspection between 15 and 18 months after completion, a final inspection between 21 and 24 months, and the overall process completing roughly two to three years after the work finishes. For a developer the exposure is therefore timing and capital lock-up rather than a line item, and it runs well past the point at which most project equity is expected back.

The percentage is set by regulation and has been amended and deferred more than once, so the prescribed percentage at the date of lodgement is worth confirming against the Planning Portal rather than assumed from a figure quoted in commentary. The NSW Government’s own description of the bond includes the qualifier “or the prescribed percentage in the regulation”, which is a fair signal that the number has moved.

Sources: NSW Planning Portal, strata building bond lodgement and NSW Government, strata building bond and inspections scheme.

Victoria: a developer bond, ahead of decennial liability insurance

Victoria legislated a similar mechanism. The second reading speech for the Building Legislation Amendment (Buyer Protections) Bill 2025 in the Victorian Parliament identifies the gap directly: “A gap currently exists with respect to financial protections for home owners in apartment buildings with a rise in storeys of more than three because these buildings are not covered by domestic building insurance.”

The response described in that speech is a bond: a developer of an apartment building with a rise in storeys of more than three will need to secure a bond of 2 per cent against the cost of the building work, to be secured before an occupancy permit application. The speech also frames the bond as interim, stating that it “will address this gap in the interim ahead of the introduction of decennial liability insurance for these apartments in future”, and refers to building assessors appointed by the Building and Plumbing Commission where a developer’s nominee is not approved.

Two things follow for a Victorian apartment developer. The near-term question is the commencement and transitional detail, which the second reading speech does not fix and which a construction lawyer can confirm against the Act and regulations as made. The longer-term question is decennial liability insurance, a ten-year cover on the building rather than on the builder’s solvency, which would change the risk allocation on multi-storey residential work considerably if and when it arrives.

Source: Parliament of Victoria, second reading speech, Building Legislation Amendment (Buyer Protections) Bill 2025.

Who pays the builder warranty insurance premium?

The builder generally holds the policy, and the owner generally pays for it, which in a development context means the developer pays for it inside the contract sum.

Queensland is the most explicit. The Queensland Building and Construction Commission states that the owner is responsible for the cost of the premium, that the contractor pays the amount to the Commission to insure the work, that the premium “must be included as part of your contract”, and that it is “paid before work begins”. In other jurisdictions the mechanics differ but the economics tend to run the same way: the premium is a cost of doing residential building work, and it is priced into the tender.

For a developer this has three practical consequences. The premium sits inside the construction line of the total development cost rather than in professional fees, so comparing tenders on headline contract sum may compare different insurance treatments. It is typically payable before work begins rather than progressively, so it lands early in the cashflow. And where it is excluded from a tender as a provisional item, the exclusion is worth finding before award rather than after.

Premium rates themselves are published by each scheme and vary by contract value, work type and in some jurisdictions by the builder’s own risk rating, so a current rate table or a quoted figure from the scheme is the only reliable input for a feasibility. Rates quoted in commentary tend to be out of date.

How does builder warranty insurance constrain the builder shortlist?

A builder who cannot obtain cover for the project cannot lawfully take the contract, which turns an insurance requirement into a procurement constraint.

Most schemes assess the builder before issuing cover, and the assessment generally looks at financial capacity, turnover and the value of work already on the books. The practical effect is a ceiling: a builder may be eligible for work up to a certain value, or for a certain number of open jobs, and a project that pushes past that ceiling cannot be insured for that builder even though the builder is licensed and willing. A tender that comes in well below the others from a builder whose eligibility has not been checked is a risk worth pricing, and the check sits more naturally in the diligence that goes into choosing a builder than in the week before award.

The failure mode is specific. The developer awards the contract, the builder applies for cover, the scheme declines or limits it, and the project cannot obtain the certificate it needs before a commencement notice or before taking a deposit on off-the-plan stock. At that point the options are re-tendering, restructuring the contract, or waiting, and all three cost programme. The trap is sequencing, because eligibility is generally confirmed after award unless someone asks earlier.

Where the contract is a design and construct arrangement, the warranty insurance obligation usually follows the party carrying out the building work, which may sit differently from where the design risk sits. The interaction between the two is worth checking against the design and construct contract rather than assumed.

What does the warranty insurance position mean for defect exposure?

Warranty insurance caps are generally well below rectification cost on anything other than a single dwelling, so the residual sits with the developer, the builder’s solvency, or the contract.

Consider the spread across jurisdictions on a project of identical construction. A dwelling in Western Australia carries published cover of $100,000. The same dwelling in Victoria carries $300,000. In New South Wales the builder must hold at least $340,000. In South Australia, for a policy issued from 1 October 2025, the published maximum is $250,000. None of those figures is calibrated to the cost of rectifying waterproofing or facade defects across an attached-dwelling scheme, and in several jurisdictions the cap applies per claim category rather than per building.

The timing spread matters as much as the amount. Queensland gives six years and six months on structural defects but six months on non-structural ones. The Northern Territory gives six years and one year respectively. South Australia gives five years on defects. New South Wales and Victoria give six and two. A developer who sells completed stock across multiple states is managing several different tails at once, and the shortest of them is often the one that catches a handover team that has not read the local rule.

Because the cover responds only on builder death, disappearance or insolvency, the practical sequence on a defect claim usually starts with the builder and the contract. That makes the defects liability period, the security held, and the construction contingency carried through to final release the mechanisms doing the day-to-day work, with the policy sitting behind them for the case where the builder is gone.

What happens when a developer builds and sells the stock?

Where a developer holds the builder’s licence and constructs its own stock, the position changes in two ways worth isolating.

The first is that the cover and the warranties follow the dwelling to the purchaser. The Australian Capital Territory states that a purchaser within the warranty period is entitled to the remainder of it. New Zealand’s implied warranties are expressly enforceable by future owners. The Tasmanian provisions require indemnity for owners and subsequent owners. The purchaser who buys completed stock generally inherits rights without ever having signed a building contract, and the developer who built it is generally the counterparty to those rights.

The second is the owner-builder position, which is restrictive. South Australia states that an owner carrying out the work themselves cannot take out building indemnity insurance at all. Western Australia requires an owner-builder selling within seven years of the building permit to hold cover. The Northern Territory requires an owner-builder to obtain a fidelity fund certificate to protect future owners after a sale. An owner-builder route taken to avoid a premium can therefore produce a worse outcome on resale than the premium would have cost, and in at least one jurisdiction it removes the cover from the chain entirely.

How does the premium and the bond flow into a feasibility?

The premium is a construction-cost input. The bond, where it applies, is a capital lock-up with a long tail, and the two behave differently in a cashflow.

Take a New South Wales apartment project of 24 units at an average price of $1,150,000, so a gross realisation of $27,600,000. The building is four storeys, so warranty insurance does not apply and the strata building bond does. Building contract price is $14,000,000. Professional fees and authority costs are $1,540,000, finance costs $1,260,000 and contingency $700,000, giving $17,500,000 before selling costs. Selling and marketing at 3 per cent of gross realisation adds $828,000, for $18,328,000 of costs excluding land.

At a target development margin on cost of 18 per cent, the total cost the project can carry is $27,600,000 divided by 1.18, or $23,390,000. Subtracting the $18,328,000 of non-land costs leaves a derivable land figure of approximately $5,062,000. Profit is $27,600,000 less $23,390,000, or $4,210,000, which against $23,390,000 of cost is 18.0 per cent. The bond does not appear in that calculation, because it is refundable.

Where the bond shows up is in peak equity and in how long it stays out. At 2 per cent of a $14,000,000 contract price the bond is $280,000, lodged before the occupation certificate application and released only after the final inspection in the 21 to 24 month window, so roughly two to three years after completion. That is capital committed after practical completion, after settlements, and after the point most equity is modelled as returning.

Changing one input: if the prescribed percentage were 3 per cent rather than 2 per cent on the same $14,000,000 contract price, the bond becomes $420,000, an additional $140,000 held across the same period. The land figure above does not move, because the bond remains refundable. What moves is the equity profile and the internal rate of return, since the timing of the final distribution shifts rather than its amount. Modelling the bond as a cost line overstates the hit, and modelling it as nothing at all understates it, which is why it tends to belong in the cashflow as a timed outflow and inflow rather than in the cost schedule.

What applies in New Zealand?

New Zealand has no mandatory builder warranty insurance scheme. The protection runs through statutory implied warranties instead, and they are more durable in one respect than the Australian schemes: they do not depend on the builder having died or become insolvent.

The Ministry of Business, Innovation and Employment states that sections 396 to 399 of the Building Act 2004 imply warranties into contracts for building work on household units and into contracts for the sale of household units by commercial on-sellers, which captures developers selling completed residential stock. The warranties cover materials being suitable for purpose and new unless the contract says otherwise, work carried out in a proper and competent manner with reasonable care and skill and in accordance with the plans, specifications, building consent and all laws, completion by the specified date or within a reasonable time, and the unit being suitable for occupation when the work is complete.

Two features are worth noting for a developer. The warranties apply “despite any provision to the contrary in any agreement or contract”, so they cannot be contracted out of. And future owners “are entitled to enforce the implied warranties as if they were a party to the original contract”. The period for bringing an action for breach of contract is stated as six years from the date of breach.

Private warranty products are available in the New Zealand market and are commonly offered through builder membership schemes, but they are commercial products rather than a statutory scheme, and their terms and exclusions vary. A developer relying on one is relying on that policy wording rather than on a legislated minimum.

Source: Ministry of Business, Innovation and Employment, implied warranties under sections 396 to 399 of the Building Act 2004.

Which changes are in train?

Several jurisdictions moved in 2025 and 2026, and a project spanning a commencement date may sit on either side of a rule depending on when the contract was entered into.

South Australia’s threshold moved to $20,000 from 10 November 2025, and the maximum cover for policies issued from 1 October 2025 moved to $250,000. The Northern Territory’s threshold moved to $25,000 from 30 March 2026. The Australian Capital Territory’s minimum sum insured moved to $200,000 from 1 January 2025, with the claim lodgement window extended to 180 days. Victoria legislated a developer bond for apartment buildings with a rise in storeys of more than three, framed in the second reading speech as interim pending decennial liability insurance, and has moved the provision of domestic building insurance to the Building and Plumbing Commission. Tasmania’s scheme is legislated and commences by proclamation.

Transitional provisions generally key off the date the building contract was entered into rather than the date work starts or the date a claim arises, which means a long pre-construction period can leave a project under the old rule for years. That is a question for the contract date, and it is one of the few places where getting the date of a signature right changes the answer.

What to ask your construction lawyer and your insurance adviser

The questions below are the ones that decide the position on a specific project, and they are answered by someone looking at the contract, the certificate and the jurisdiction, not by a guide.

For the construction lawyer:

• Which scheme and which threshold apply to this contract, given the jurisdiction and the date the contract was or will be entered into, and does any transitional provision put us under a superseded rule?
• Does this building fall inside or outside the scheme on the storey test, counting any carpark level the way the local rule counts it, and if it falls outside, what bond or other mechanism applies instead?
• Where the project is outside the warranty insurance scheme, what is the exact trigger, amount, form and release timing of the applicable bond, and what happens to it if the developing entity is wound up before release?
• How do the statutory warranty periods in this jurisdiction interact with the defects liability period and the security in our building contract, and where is the gap between them?
• What are our obligations to purchasers of completed stock in each state where we sell, including what must be disclosed and what passes to them on transfer?
• If we hold the builder’s licence ourselves, or build through a related entity, what changes about the cover, the warranties and our exposure on resale?
• What is the consequence for the building commencement notice, the occupation or occupancy permit, and any deposit already taken, if the certificate turns out to be invalid or the cover was never in place?

For the insurance adviser:

• Is the builder currently eligible for cover at this project’s value, and what is the headroom between their current eligibility and what this contract requires?
• What is the sum insured actually stated on the certificate for this project, as distinct from the figure on the scheme’s web page, and per what unit does it apply: per dwelling, per claim category, or per building?
• Which exclusions in this policy would be likely to bite on the defects most common in this building type, and what is left uninsured as a result?
• What are the notification and lodgement windows that apply after handover in this jurisdiction, and what has to happen operationally for us not to miss the short non-structural window?
• Where the project is outside the statutory scheme, what cover is available in the commercial market for multi-storey residential defect risk, on what terms, and what would it not respond to?
• What is the current premium rate for this contract value and work type, and is it quoted inside or outside the tender we are comparing?

Where builder warranty insurance sits in the compliance stack

Builder warranty insurance tends to be treated as a builder problem, and on most projects the paperwork genuinely is the builder’s. The reason it keeps landing back on the developer is that it is wired into the approval sequence and the sale contract rather than sitting beside them. The certificate gates the start of work in several jurisdictions and the taking of a deposit in others. The sum insured sets a floor on what a purchaser can recover without suing. The builder’s eligibility quietly sets the ceiling on who can be awarded the contract. And where the scheme does not apply at all, which is most apartment product, a bond lodged by the developer takes its place and stays out for years after completion.

The unifying question for a developer is not which scheme is best. It is where the defect risk actually comes to rest on this project, in this jurisdiction, at this height, under this contract. In most cases the answer is not the policy.