Home warranty insurance obligations
Principal contractors have an obligation to take out home warranty insurance cover on behalf of their clients to ensure the home owner's new home or renovation is protected for defective or incomplete building work and subsidence.
The requirement to pay an insurance premium for home warranty insurance is mandated by legislation.
Your responsibility if a home owner makes a claim
The home owner can make a claim if:
- you won't or can't finish the work under a contract
- you fail to fix defects.
Although home warranty insurance helps owners complete a project or fix defects, the licenced contractor is still responsible for their defective or incomplete work. We will seek to recover from you the amount we pay out on any claim. Therefore, it is important that you always comply with your contract and fix any defects in your work.
Once a home owner lodges a claim we will decide whether or not to direct the licensed contractor to rectify or complete the work.
If a contractor is issued with a direction to rectify we note this on the public licensee register.
Having a contractor rectify defective work under a direction is often a much faster outcome for home owners than progressing through a claim under the Queensland Home Warranty Scheme.
If a contractor fails to comply with a direction, they can face a range of enforcement actions.