Contractor insurance requirements
Professional indemnity insurance
Professional Indemnity (PI) insurance provides financial protection and may cover the costs if a contractor has caused building errors or omissions.
Getting PI insurance is a requirement for some licensees and is a matter of simply contacting an insurance provider.
You can view a list of licence classes that require PI in the Minimum Financial Requirements (PDF). Once you become licensed, you need to make sure that your insurance remains active.
Acceptable evidence of cover
- Certificate of Currency (PDF) signed by the insurer that complies with the Insurance Contracts Act 1984, or
- Certificate of Currency (PDF) and a receipt from the broker, if the policy has been arranged by a general insurance broker registered under the Financial Services Reform (Consequential Provisons) Act 2001
Applying for a PI exemption
You can apply for an exemption by completing the Declaration – Professional Indemnity Insurance form (PDF), and providing evidence that:
- PI is not available in the market place, or
- it is economically unviable for you to obtain PI.
If we grant exemption, a condition will be placed on your licence. You’ll be required to give your clients a notice in writing (a clause in a contract, or by a separate notice), stating you do not hold PI Insurance.
Note: You don’t need to provide PI if you hold a Nominee Supervisor, Site Supervisor or Fire Protection – Occupational licence.
Exemption from providing financial documentation by holding PI
In certain circumstances, you may be exempt from providing financial information.
If you apply for, or hold a contractor licence in any of the following licence classes, and you meet the relevant conditions, you can provide evidence of your current PI Insurance and a completed Estimated Maximum Revenue (PDF), instead of providing financial information:
- Builder Project Management Services
- Building Design – Low Rise
- Building Design – Medium Rise
- Building Design – Open
- Hydraulic Services Design
- Hydraulic Services Design (excluding design of on-site domestic waste water management)
- Site Classifier
- Site Classifier (excluding on-site domestic waste management).
You are not eligible for this exemption if you already hold, or are applying for, a contractor licence in a class other than those mentioned directly above, e.g. you hold or are applying for a Carpentry contractor licence.
What if I have been granted a PI exemption?
The exemption from annual turnover is not applicable and you must provide the relevant financial information.