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Industry News No.1

Industry News No.1

Legislative Changes to Home Warranty Insurance.

Statutory Warranty periods.

From 1st February, 2012 onward the Warranty period will be 6 years for structural defects and 2 years for non-structural defects. These periods will be extended by 6 months if the homeowner or subsequent purchaser becomes aware of a defect in the last 6 months of these time periods.

New Threshold.

All residential building work worth more than $20,000 must be covered by mandatory Home Warranty Insurance. The current threshold is $12,000. The new threshold will apply to the sale of a home by an owner-builder and to cooling off periods.

Benefits for Homeowners.

Homeowners are required to pay the first $250 of any claim instead of $500.

In addition all Home Warranty Insurance policies after 1st February, 2012 will receive a minimum cover of $340,000, regardless of legislation.

New Category for small job contracts.

After the 1st February, 2012 a new category of written for “small jobs” worth between $1001 and $5000 will come into effect.

A small job contract must be in writing, dated and signed on behalf of both parties and contain the following information.

*The names of the parties, including the name and number of the holder of the contractor license.

*a description of the work (including any plans and specifications for the work)

*The contract price if known.

For more information go to www.fairtrading.nsw.gov.au

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