1. What is home warranty insurance?

Home warranty insurance provides protection for consumers of residential building services and subsequent purchasers. It provides cover against financial loss caused by the builder’s failure to rectify or compensate the home owner for the builder’s defective or incomplete works.

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2. Who took out Home Warranty Insurance with Homesafe?

From 1st July 2003 until 26th April 2004 (being the date that Homesafe was placed into provisional liquidation) a range of builders insured approximately 800 units of work with Homesafe where the value of the works exceeded $12,000. This insurance was purchased by the builder, for the benefit of their clients (ie. home owners) as well as for subsequent owners of the property, who received a warranty on the works performed by the builder.

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3. What is the Government assistance package?

The Treasurer of the State of Victoria, in accordance with section 25A(1)(b) of the Victorian Managed Insurance Authority Act 1996 directed VMIA to establish, operate and administer a scheme to issue indemnities to homeowners whose homes are covered by builders warranty bonds issued by Homesafe Equities Pty Ltd (Homesafe) between 1 July 2003 and 26 April 2004 to the extent of the indemnity provided to each homeowner by Homesafe under the Homesafe bondholder's builders warranty bond.

In accordance with the Direction, VMIA shall indemnify the Homesafe bondholders subject to the following conditions:

• VMIA shall not charge any premium or other fee to the Homesafe bondholders for the provision of an indemnity by VMIA
• the Homesafe bondholders shall assign to VMIA all rights of recovery against Homesafe under the builders warranty cover issued by Homesafe.
  

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4. What is a builders warranty bond?

This is a copy of the original home warranty insurance policy, provided by the builder to the original home owner. These bonds (ie. home warranty policies) were actually issued by HOMESAFE and they state the terms and conditions of cover.

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5. Where can I get a copy of my insurance certificate?

Copies can be obtained from your local council or from the private surveyor that issued the Building Permit for your property. If you signed a construction contract with the builder and applied for a loan through a bank, they should also hold a copy of your certificate. If you have a contract of sale, then under section 32 you should have been supplied with your certificate.

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6. Does VMIA Builders Warranty Program (“BWP”) hold copies of Homesafe Guarantee Bonds?

No. BWP does not possess the original Homesafe insurance documents. Accordingly, you will need to locate the applicable Guarantee Bond prior to making enquiries of BWP.

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7. I don't know who my builder was insured with. What can I do?

Try to locate your insurance certificate/Guarantee Bond, this will tell you the builder's insurer. Refer to questions 3 and 4 above.

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8. I have discovered defects in my house. What do I do now?

The first step is try to contact your builder. If the builder is not contactable, then try to locate your insurance certificate or Guarantee Bond (refer to questions 4 and 5 above). If this is as described in 2 above, contact VMIA BWP. If the insurer is someone else than Homesafe, you will need to contact the relevant insurer and request their claim form.

In addition, if your builder is still trading, and has not died or disappeared, then you will also be unable to rely on the Homesafe Guarantee Bonds and you will need to pursue the builder directly, via Consumer Affairs (Building Advice and Conciliation of Victoria “BACV”) or the Victorian Civil and Administrative Tribunal (“VCAT”).

Furthermore, if you have non-structural defects, then you can only claim on these items for up to two years of when the works were undertaken, whilst non-completion and structural defects can be claimed for up to six years, from the last date the builder performed works on the site.
Should Homesafe be the insurer, you should not attempt or arrange for the undertaking of any repairs to defective or incomplete works prior to an assessment being made by BWP of your claim. Any such repair work is at your discretion and risk.

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9. Will VMIA BWP comply with all the terms of HOMESAFE insurance policies and is the full extent of the policy coverage available?

In most cases, VMIA BWP stands in the shoes of the former Homesafe in relation to Home Warranty Insurance policies issued by them. However, claims are assessed in accordance with legislation and under the conditions of the policy. VMIA BWP will assess the claim on its own merits.

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10. Do we need to fill out a VMIA BWP claim form?

Yes, to be eligible for Government assistance under the Homesafe package you are required to complete an VMIA BWP claim form and to provide the documentation required.

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11. How do we obtain a claim form?

Download the claim form from this website.

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12. What are the reasons my claim could be rejected?

Claims can be rejected for a number of reasons. Such reasons include, but are not limited to:

• Your insurance could have expired.
• Your builder is still solvent;
• Your builder has not died or disappeared;
• The items being claimed are non-structural and are being claimed after two years of being completed;
• The builder may have continued to insure through a different company.
• No defects were apparent by our assessor.
• The amount of the claim may not exceed the excess applicable.
• The limit of indemnity has been exhausted.

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13. Our builder is in liquidation. Do we still have any insurance?

Yes, provided that:

• A Homesafe Guarantee Bond was issued on your property and has not expired; and
• Provided that the dollar value of the indemnity on the HOMESAFE policy has not been fully exhausted by other claims made under the policy.
• The defect/s being claimed are of the type that the Guarantee Bonds would respond to. (Refer to question 8)

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14. We have purchased an existing house and a defect has developed. Can we make a claim?

Yes, you are a successor in title and can make a claim provided that:

• A Homesafe policy was issued on your property and has not expired; and
• Provided that the dollar value of the indemnity on the HOMESAFE policy has not been fully exhausted by other claims made under the policy. and
• The defect/s being claimed are of the type that the Guarantee Bonds would respond to. (Refer to question 8)
  Your claim will be assessed in accordance with the legislation and under the conditions contained in the original insurance policy.

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15. We wish to sell our home that was previously covered under HOMESAFE. What do we have to do?

Nothing. The homeowner can rely on the Homesafe Guarantee Bond for the requirements of Section 32 of the Sale of Land Act. Potential buyers should refer to this website regarding the Government’s Assistance Package for owners affected by the collapse of HOMESAFE.

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16. We want to lodge a Common Property defects claim. What do we do?

For defects that fall under the common property area in an apartment building, for example, a claim form has to be completed by each individual unit owner as well as by a member of the Body Corporate. The reason for this is that there is a $200,000.00 maximum claimable limit for each unit. If any monies are to be paid out, a percentage would be taken from each unit owners limit. We therefore require authorisation from the owners of each unit to do this.

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