10 year guarantee for small residential building projects

New insurance-backed 10 year guarantee for small residential building projects

23rd November 2016

A leading provider of insurance-backed building guarantees has today announced the launch of a policy specifically targeted at small residential projects.

Rising house values and historically low mortgage interest rates are driving strong growth in demand for renovation work nationwide, with spending up more than 30% to over $1.5bn. Builders across the country are struggling to keep up with this demand and media reports of shoddy workmanship are increasing.

Ben Rickard of Builtin Insurance says their new Small Project Guarantee was developed in response to demand from homeowners for an affordable 10 year defects guarantee for building work below the $30,000 threshold, above which written building contracts are now legally required.

“Builtin’s new Small Project Guarantee gives homeowners the same peace of mind for their small works such as renovations, decks, fences and minor alterations that owners of new homes can get. It guarantees that the workmanship and materials supplied by their builder will be free of defects for 10 years. Additionally, a Small Project Guarantee covers their deposit and guarantees completion of the work if their builder is unable to finish it”.

The Guarantee is only available from builders who have met Builtin’s assessment criteria, which includes a declaration of their financial solvency. They must also have an up to date eligibility status, which the homeowner can ask to see. Rickard says this accreditation can give additional assurance to homeowners that the builder’s business has been professionally scrutinised, whether or not they are a Licensed Building Practitioner.

“Tens of thousands of residential renovation projects are undertaken every year. Our experience is that the vast majority of projects are completed without incident. But as is the case with any insurable risk, the cost of something going wrong, such as their builder going bust or finding a serious defect, can put severe strain on families, both financially and emotionally. An insurance-backed guarantee is now a very affordable way to manage this risk.”

The Guarantee can be applied for online by the homeowner at: www.builtininsurance.co.nz/small-project-guarantee. They must include their builder’s “Eligibility Number”, which demonstrates that the builder has passed Builtin’s accreditation assessment. Accreditation is free and builders who are interested can apply online at: www.builtininsurance.co.nz/small-project-guarantee/request-accreditation.

The Guarantee costs $199 for projects up to $10,000, and $260 for projects between $10,001 and $30,000.

Builtin’s Small Project Guarantee is backed by CBL Insurance Limited, a licensed insurer and the country's largest New Zealand owned and operated insurance company. CBL underwrite the Homefirst Builders Guarantee, which guarantees more than 10,000 homes in New Zealand, and they have more than 5 million homes under warranty worldwide. CBL are rated A- (Excellent) by A.M. Best.

ENDS

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