Technical Q&A

Q: I noticed that in the Class A, B, C licence exam study notes the section titled “Residential Building Work Insurance”, page 44, it states “an owner who is a developer who will retain four or more dwellings in the building does not need to be insured”.

I am a developer and intend to start later this year and keep six of the units. Does this mean that as I am not required to obtain fidelity certificates for this development?

A: Thank you for raising this matter regarding the Class A, B, C licence exam study notes.

It should be noted that this document, the Class A, B, C licence exam study notes provides an outline or part extract of the requirements stated in section 90 of the Building Act 2004 and should be read in context.

Section 90 of the Building Act 2004 requires coverage for the owners successors in title to be covered from risk of being unable to enforce or recover under the contract under which the work has been, is being or is to be carried out because of the insolvency, disappearance or death of the builder, it insures the owner’s successors in title against the risk of loss resulting from a breach of a statutory warranty and it insures the owner’s successors in title against the risk of loss resulting, because of the builder’s negligence, from subsidence of the land.

The developer is to insure the successors in title even though the developer is not insured.

I hope this has clarified this matter for you.

The Governments website Build, buy or renovate is handy reference site and provides some very informative and useful information and should be used as a general reference source.

For those members wanting to view the build, buy renovate website, click here.

When reading documents on the Build, Buy Renovate website you should be aware of the website disclaimer. The disclaimer states in part that ‘’Australian Capital Territory makes this material available on the understanding that users exercise their own skill and care with respect to its use. Before relying on the material in any important matter, users should carefully evaluate the source, accuracy, currency, completeness and relevance of the information for their purposes and should obtain appropriate professional advice relevant to their particular circumstances”.

For further information on licencing, regulatory matters and building enquiries you may contact Access Canberra on 13 22 81.

If you have any technical questions you can contact Master Builders on (02) 6175 5900.