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Home Warranty Insurance

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  • Home Warranty Insurance

    here in Australia it is law that i supplly Home Warranty Insurance for all works of $12 000 or greater. of course the client bears the cost, and the insurance protects them against me failing to complete the work or disappearing or similar.

    this insurance is required by law, and many clients dont like the idea of paying for it ,often suggesting that they will go without to save the cost of the policy(generally about $500).

    The lesson here is: without the insurance you are in breach of the Home Building Act, and if you have a smart arse client with a good lawyer they will work this out and excuse themselves form paying. In this situation there is basically nothing the tradesman can do without spending huge ammounts on legal fees.For jobs this size its not worth it.

    A very expensive and painful lesson recently learnt by a friend of mine.and a situation probably specific to my location.

    anyone else learnt a similar lesson?

  • #2
    josh, here in california, we need to have a contractors bond. this will cover the homeowner up to 10,000. if we flake out on the job, or the contractors board makes a judgement. the bond is not insurance. it has to be paid back prior to your license being reinstated. the bond is cheap. about 150. a year.

    phoebe it is