WA approves home owner insurance reforms
The McGowan government doubles its maximum payouts for home owners affected by builder insolvencies.
Developments to the home indemnity insurance scheme have been approved by the West Australian government..
Insurance payouts will now be doubled to a maximum of $40,000 for lost deposits, and eligible home owners can also receive up to $200,000 for incomplete or defective works if their builder dies, disappears, or becomes insolvent.
“The McGowan government is committed to assisting West Australians building a home and protecting their investment,” said Commerce Minister Roger Cook.
Under the Home Building Contracts Act 1991, a builder must take out home indemnity insurance in the owner’s name before accepting payment or commencing work on residential projects valued at $20,000 or more.
In most circumstances, the insurance policy must cover the construction period, in addition to six years from the practical completion date.
“The changes to home indemnity insurance reflect current market values and challenges. We want to ensure that if a builder becomes insolvent, families are better protected and can finish their dream home,” Mr Cook explained.
“Improved home indemnity insurance coverage will give prospective home buyers the peace of mind and the confidence to build, knowing that if things do go wrong, there will be a much better safety net.”
The scheme changes are reportedly set to come into effect as soon as possible.
