Dan Quinn, Head of Customer Acquisition at BizCover, emphasizes that obtaining PI insurance is not merely a regulatory requirement but a critical component of risk management. He highlights that such coverage is essential for protecting a builder's business, profitability, reputation, and client relationships.
The Act introduces a statutory duty of care for practitioners, applicable retrospectively. This provision allows claims to be made up to ten years after the completion of construction if defects result in financial loss to landowners. Consequently, builders are exposed to extended liability periods, underscoring the necessity for comprehensive PI coverage.
BizCover plans to offer PI insurance products from providers like DUAL and Chubb, with coverage limits ranging from $250,000 to $10 million. These products are tailored for businesses with annual turnovers up to $10 million, ensuring that small to medium-sized enterprises have access to appropriate coverage.
For tradespeople in NSW, this development carries several implications:
- Proactive Compliance: Securing PI insurance ahead of the deadline ensures adherence to legal requirements and mitigates the risk of non-compliance penalties.
- Risk Mitigation: Comprehensive PI coverage provides financial protection against claims arising from professional services and advice, safeguarding the business's financial health.
- Client Assurance: Holding adequate PI insurance enhances credibility and trustworthiness in the eyes of clients, potentially leading to increased business opportunities.
Given the evolving regulatory landscape, it is imperative for NSW builders to review their current insurance arrangements and ensure they meet the forthcoming requirements. Engaging with reputable insurance providers and seeking professional advice can facilitate this process, ensuring that builders are adequately protected and compliant with the new legislation.
In summary, the extension of the compliance deadline under the Design and Building Practitioners Act 2021 provides NSW builders with a crucial window to secure necessary PI insurance. Proactive action in this regard will not only ensure legal compliance but also fortify the business against potential liabilities, contributing to long-term stability and success.
