Domestic Building Insurance (DBI), also known as Home Warranty Insurance, has changed significantly in Victoria. The Victorian Managed Insurance Authority (VMIA) introduced several changes to DBI on 1 July 2017, launching the new ‘BuildVic’ portal, streamlining the DBI model by removing QBE and appointing MBA Insurance Services as one of six ‘panel distributors’ allowing us to provide members with direct access to VMIA. DBI rates reduced sharply with the change. Costs reduced anywhere from 25 to 35 per cent for DBI job-specific policies. The changes come with other benefits that may help builders earn more money.

Developments since 1 July
The introduction of BuildVic has been very well received, with builders now able to transact DBI themselves, enabling members to immediately obtain job-specific DBI certificates in a matter of minutes. While MBAIS still manually transacts DBI for many clients, a much-higher-than-expected number are already comfortable using BuildVic themselves, with the system easy to use and available 24 hours a day, seven days a week. BuildVic also allows builders to obtain copies of their letter of eligibility at any time, while also outlining available limits, ensuring you can access up-to date information easily.

Completed projects refresh your job limits
The recent changes also allow for completed jobs to be restored to your available limit. This allows builders to complete more work, as the annual limit has changed to an ‘open job’ limit. For example, a builder with a $5 million limit, with an average build time of nine months, now has the capacity to do more than $5 million in a 12-month period. Completed jobs will refresh the limit throughout the year – allowing potentially $5.5 million, or $6 million worth of work to be completed over a 12-month period.

Here are some FAQs:

Q: I’m having trouble logging into BuildVic. Is BuildVic working properly?
A: The preferred browser for BuildVic is Google Chrome, and unfortunately it may not function correctly with other browsers.

Q: The new letter of eligibility does not state policy number; what do I write in the registration renewal form?
A: The new letter of eligibility states ‘builder account number’ instead of ‘policy number’. You can use this number on the application form instead of policy number.

Q: What is the commencement date and expiry date for my letter of eligibility (policy)?
A: Technically speaking, there is no commencement or expiry date. The policy itself is considered perpetual from the initial approval/inception. However, for formality of procedure please mark the ‘date issued’ date on the letter of eligibility for commencement date, and mark one year from the ‘date issued’ date for expiry date on the registration renewal application.

Q: VBA has requested an up-to-date letter of eligibility that is within a four-month period from the registration expiry date. However, the supplied letter of eligibility is outside of the specified period.
A: Unfortunately, we cannot provide a letter of eligibility that is future-dated; please contact MBAIS within four months of your registration expiry date.

Q: I need to renew my commercial building registration; can I get a letter of eligibility or certificate of currency?
A: The letter of eligibility is applicable only to domestic (residential) builders’ licences. A certificate of currency is no longer required because VBA has decided to remove the insurance requirement for commercial building registration. If you wish to renew your commercial building registration, please fill out the renewal form and make the payment for applicable fees to VBA.

Q: When do my limits replenish?
A: Your total construction limit no longer replenishes on an annual basis and has moved to a job-on/job-off rolling limit, or open job limit, with your limits reviewed periodically by VMIA. Should you need a limit increase at any stage, MBAIS can assist you through this process, free of charge.

Q: When do I need to notify the VMIA of a contract value increase?
A: Variations need to be submitted only if the contract price varies by no more than 10 per cent. The variation will be automatically covered. However, if the homeowner requests that the amounts must match exactly, then the VMIA will accommodate.

Q: When do I need to notify the VMIA of a contract value increase?
A: Variations need to be submitted only if the contract price increases by more than 10 per cent. The variation will be automatically covered, however if the homeowner requests that the amounts must match exactly, then the VMIA will accommodate.

Q: Will a defects report be required when submitting a takeover application?
A: The VMIA will assess a takeover without a defects report, but we recommend that the builder obtains an independent report and documents the current stage of works.

Q: I was previously with another broker for DBI, and would like to come across to MBAIS. How do I transfer?
A: The VMIA implemented an initial freeze on builders changing their DBI panel distributor, which lifts on 6 September. Contact MBAIS to better understand the advantages and benefits of placing DBI through MBAIS, and to obtain a VMIA distributor nomination form to make the transfer.

Need some help? Contact MBAIS or call us on (03) 9411 4555.