Building warranty insurance

Hi is this still required? We are selling inside the statutory period in NSW from when we built but a building inspector friend is saying no inspection now required and insurance has been dropped. DFT in NSW is saying similar and their website confirms same but my solicitor is insisting on it as part of the sales contract. Any help is appreciated.

Can't help as I'm in Vic but Speak to another lawyer who specialises in property transaction.

Otherwise, call up an insurance broker who could otherwise supply you with the insurance.

You'll find that your solicitor wants the builders insurance that would have been (or should have been) provided by any contractor who did work over $20k (I think that number is correct), the actual home warranty insurance has been scrapped. All your solicitor needs to do is to add a statement (a consumer warning) stating that an owner-builder permit was issued in relation to the land during the past 7 years 6 months.

If he doesn't know that then I'd suggest a different solicitor.

Hi, Solicitors are having a hard time getting up to date with these changes. The other advice you've had is absolutely correct. Home Warranty Insurance no longer applies to Owner-Builders in NSW as of January 2017. Prior to that change if you'd sold within the warranty period you had to obtain HWI at the time of (or just prior to) the sale of the property.
As jparrie pointed out, the new requirements is simply that you declare that the property was owner-built and that there is no HWI cover.
You don't need to pass on any HWI that was provided to you by contractors. Hang onto those for your own reference.

From what I understand, you are liable for anything that's not covered by the contractors insurance in that 7 year 6 month time period and it would be up to you to rectify it out of your own pocket.

That's a fairly good summary. No defective workmanship makes it to the insurance stage though unless the person responsible is deceased, bankrupt or missing (legally). The Home Warranty Insurance scheme is a cover of "last resort".
An owner-builder (same as with a builder) is responsible for any defective workmanship.
Where a contractor can be held responsible for the mistake, they will. If it can't be pinned on a contractor then the responsibility remains with the builder / owner-builder to rectify at their expense.
And where it can be attributed to the work of a contractor they'll have to fix the defect out of their own pocket.
So the only difference now, after the change in January this year, is that where an owner-builder is deceased of legally bankrupt/missing, when a defect is found, the buyer has no recourse or protection unless one of the contractors can be shown to have made the mistake.

It's always been a big issue for builders, more because of the "bankruptcy" issue. That being less common with owner-builders, its always been extremely rare for owner-builder HWI to see any claims.

I wish Vic would follow.

Money for jam for the insurance companies.

Well, If the builder is not in administration, seek legal advice.