Victorian Builders Learn More About Home Warranty

From 1 July 2026, the Victorian Building and Plumbing Commission (BPC) will introduce Home Warranty insurance, replacing the current Domestic Building Insurance (DBI) scheme.

This new scheme will apply to residential building projects up to 3 storeys valued over $20,000, with builders required to take out cover on behalf of homeowners.

What’s changing?

• Home Warranty will replace DBI for all new eligible domestic building work from 1 July 2026
• The BPC will act as the sole, not-for-profit provider of this cover
• Existing DBI policies will remain in place until expiry under their current terms

Key coverage enhancements

Home Warranty has been designed to provide greater protection for homeowners, including:

• Increased maximum cover to $400,000 (up from $300,000 under DBI)
• Cover for:
  • Structural or major defects (up to 6 years)
  • Non-structural defects (up to 2 years)
  • Non-compliant and incomplete work
• Additional protections including:
  • Lost deposits where work has not commenced
  • Certain out-of-pocket costs (subject to limits)

What this means for builders

• Builders must arrange Home Warranty insurance for eligible projects
• Premiums are expected to increase by no more than 5%, reflecting the enhanced coverage
• Premiums must be paid within 10 days of contract signing

Additional regulatory changes

The introduction of Home Warranty also forms part of broader reforms aimed at improving building outcomes, including:

• New powers for the BPC to inspect and enforce compliance before occupancy
• Stronger rectification requirements where defects are identified
• Significant penalties for non-compliance with notification requirements

HIA Insurance Services DBI Webinar - Introducing Home Warranty Insurance 1 July 2026

We’re here to help

An experienced broker who understands the construction industry can help you compare different options and select cover that aligns with your risk profile and contractual requirements. As specialists in industry-specific insurance for Builders and Tradies, HIAIS is committed to helping protect your business and livelihoods. To find out more, chat with one of our experienced brokers.