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Importance of Home Warranty Insurance in NSW

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Importance of Home Warranty Insurance in NSW

Are you an owner builder in NSW planning to sell your house within six years of its completion? If yes, then you require home warranty insurance
 
Owner Builders are not the only ones who have to take out home warranty insurance. Subcontractors, builders and tradies also have to take out home warranty insurance if the contract between them and the owner builder is worth more than 20,000 dollars (in NSW).
 
According the NSW Fair Trading Authority, the $20,000 includes the materials supplied by the contractor. The official website, www.fairtrading.nsw.gov.au, also warns that the home warranty must be taken out by the sub-contractors after the contract is signed, but before any money changes hands (between the owner builder and the sub-contractor) or any work is started on the site.
 
If you sell your house within six years of its completion, you have to attach copies of your owner builder permit and your home warranty insurance with the sales contract. Failure to do so will give the purchaser the right to void the contract.
Home warranty insurance covers the purchaser of the house in case of any defective owner builder work. The insurance will only provide coverage if the owner builder is insolvent, has disappeared or is deceased. 
 
As an owner builder in NSW, you have to contact your insurance provider before you advertise your property. 
Being an owner builder in NSW, or anywhere else for that matter, is a lot of responsibility. The quality of work being performed has to be ensured and you are held responsible in case of any defects. Although building inspectors are very thorough after your project is completed, but the subsequent buyer has to be protected from any defects that may appear in the long run. Therefore, the NSW Fair Trading policies have been designed in a way that the purchaser of the house is protected for about six years after completion of work.
 
Similarly, the owner builders in NSW are also protected against any defects that may appear six years after the completion of work, in this case, the contractors and tradies are held responsible. As we discussed earlier, the contractors have to take out home warranty insurance as well for any work costing over 20,000 dollars. That warranty covers any defects that appear in the long run, and protects the interests of the owner builder. 
 
The minimum coverage that the insurance companies must provide is 340,000 dollars. Click here to get an instant home warranty insurance quote, so that you can get an idea of what kind of coverage you can get. 

 

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