The legislation, which originally set a 2025 enforcement date, has been extended by 12 months to allow industry participants adequate time to comply. Under the updated rules, builders must obtain PI coverage that they reasonably assess as sufficient to meet potential liabilities. Notably, the act does not specify a fixed minimum coverage amount, placing the onus on practitioners to determine appropriate levels of insurance.
BizCover, a prominent insurance provider, is urging building professionals to review their existing arrangements well ahead of the revised compliance date. Dan Quinn, head of customer acquisition at BizCover, emphasizes that PI insurance is a core component of risk mitigation, stating, "This isn't just about ticking a compliance box. It's about protecting your business's future, profitability, and reputation, as well as your clients."
Additionally, the act introduces a statutory duty of care for practitioners, which applies retrospectively. This provision allows for claims to be made up to ten years after construction completion if defects cause financial loss to landowners. Consequently, the extended liability period heightens the need for tailored PI protection.
For tradies in NSW, this legislative change necessitates proactive planning. Reviewing current insurance policies, consulting with insurance brokers, and ensuring adequate coverage are essential steps to comply with the new requirements and safeguard against potential liabilities.
In summary, the forthcoming PI insurance mandate represents a pivotal shift in NSW's construction industry. By taking timely action, builders can ensure compliance, protect their businesses, and continue to deliver quality services to their clients.
