Owners MUST MUST MUST check that the Domestic Building Insurance has been put in place before paying any money. We cannot say this enough. It’s a simple check, but most (maybe all) disasters for home owners are due to not checking this.

Since 1995, the Domestic Building Contracts Act 1995 (Vic) requires Domestic Building Insurance for all domestic building projects (including renovations over $16,000).

Despite this, Porter Davis went into liquidation on 31 March 2023 - leaving many of its customers without Domestic Building Insurance. The Victorian government has since announced that it would support Porter Davis Homes customers who signed a Contract and paid a deposit but were not covered by Domestic Building Insurance.

There are limits on the cover, set out in the particular policy documents. The claim amount limit is currently $300,000, capped at 20% of the building contract price. The policy covers defects other than non-structural defects for the first 6 years from completion, and non-structural defects for the first 2 years from completion.


The policy covers:

- The refund of the deposit you paid to the builder if no building work had commenced on your site.

- Incomplete works – up to 20% of the original building contract price, inclusive of costs such as temporary fencing, locksmiths, contract works insurance and amendments or extension of the building permit.

- Structural building defects – for up to 6 years after the completion of work or termination of the building contract.

- Non-structural building defects – for up to 2 years after the completion of work or termination of the building contract.

- Other losses – out of pocket expenses such as alternative accommodation and storage fees (for up to 60 days) in some circumstances.


Before you sign a building contract, please do this:

Carefully check (when received from the Builder) that the Domestic Building Insurance has, in fact, been effected by the Builder in respect of this particular Domestic Building Contract - and the cover is still currently in effect.

Regards,

​- John McMullan