Reforms to the Home building compensation scheme commenced on 1 January 2018 to improve the financial sustainability of the scheme. The market for insurance was opened to competition and innovation, and premiums were to be transitioned to levels that reflected the risk of different projects, and recover the costs of the scheme. At present, the Government-owned insurer, icare, remains the sole provider in NSW.
Our review will consider the effectiveness of reforms implemented in 2018 and whether the scheme could further mitigate risks of builders becoming insolvent reduce impediments to private sector participation. We are also interested in whether there are other products that would provide more value to builders and homeowners.
IPART’s review is only one small part of the NSW Government’s broader reform program in relation to the building and construction industry. The Building Commissioner has been appointed to lead the implementation of the reforms and advise Government on any additional measures that may be needed to ensure better protections for homeowners and to lift building standards across NSW.