Need Home Building Compensation Fund Insurance?
Builders, developers and trade contractors: if your NSW residential building project is valued at more than $20,000 including GST, you may need Home Building Compensation (HBC) cover before you take a deposit or start work. ABS Insurance Brokers can help you understand eligibility, project certificates and the information required for an application.
Tell us what you need below, or call 1300 871 318 for practical assistance.
Home Building Compensation Fund Insurance: The Quick Answer
Home Building Compensation Fund insurance—also called HBCF insurance, builders warranty insurance and historically home warranty insurance—is compulsory last-resort protection for many residential building projects in New South Wales. It protects homeowners if a builder cannot complete work or fix defects because of specified events such as insolvency, death, disappearance, or certain licence suspensions.
Project threshold
More than $20,000 including GST for covered residential building work.
Before work starts
A project certificate is generally required before taking payment or commencing work.
Eligibility first
Builders generally need a current certificate of eligibility before applying for project cover.
NSW scheme
SIRA regulates the scheme and icare is the sole provider of HBC cover in NSW.
What Is Home Building Compensation Fund Insurance?
HBCF insurance is not a replacement for a builder’s public liability, contract works or professional cover. It is a statutory safety net for the homeowner when a licensed builder is unable to meet certain obligations. The cover responds only when the policy conditions and an eligible claim trigger are satisfied.
In everyday conversations, people still search for “builders warranty insurance” or the old term “homeowner’s warranty insurance”. In NSW, the current official terminology is Home Building Compensation cover. All of these expressions commonly refer to the same scheme, although the exact policy wording and current government rules always control.
For eligible work, the cover must generally provide at least $340,000. A separate project certificate identifies the individual job and gives the homeowner evidence that cover is in place.
When Is HBCF Insurance Compulsory in NSW?
A builder or contractor will generally need HBC cover when they contract directly with a homeowner, owner-builder or developer to undertake residential building work valued at more than $20,000 including GST, unless a specific exemption applies.
Common project types include:
- new detached homes, duplexes and triplexes;
- low-rise residential buildings generally up to three storeys where the scheme applies;
- alterations, additions and renovations, including work in buildings of any height where covered;
- swimming pools, spas, garages and other residential outbuildings;
- speculative residential building projects where the builder owns the land during construction.
A subcontractor who works for a head contractor generally does not need to obtain HBC cover for that subcontract. Projects valued at $20,000 or less including GST are also generally outside the compulsory threshold. Because classifications and exemptions can be technical, confirm the position before signing contracts, accepting deposits or starting work.
The HBCF Process: Eligibility First, Project Certificate Second
The most important practical distinction is between builder eligibility and a project certificate. They are connected, but they are not the same approval.
1. Confirm the work
Check the contract value, project type, parties and whether an exemption applies.
2. Establish eligibility
Apply for or renew the builder’s certificate of eligibility, including approved limits and conditions.
3. Apply for project cover
Submit the individual contract details and premium information for the specific job.
4. Give the certificate
Provide the homeowner with the HBC project certificate before taking payment or commencing work.
Your certificate of eligibility may set a maximum contract price, maximum number or value of open jobs, approved construction types and other conditions. A project outside those settings can require an eligibility variation or further assessment before a certificate can be issued.
Good preparation can reduce avoidable HBCF delays: review project value, open jobs, financial information and contract details before lodging.
How Builder Eligibility Is Assessed
An HBCF eligibility assessment looks beyond the new project. The insurer considers whether the building business has the financial and technical capacity to complete its current and proposed residential work. Information commonly reviewed includes:
- financial performance and position, including profitability, working capital, net tangible assets and cash flow;
- equity exposed to the business and the financial support available from directors, owners or related entities;
- technical capability, licence history, experience, management systems and the complexity of the proposed work;
- claims and project history, including previous HBC claims, disputes, defects or completion concerns;
- work in progress, open job numbers and values, contract sizes and the business’s growth rate.
Eligibility can be granted for a defined period and may be subject to periodic or special review. A rapid increase in turnover, larger contracts, changed business structure or a request for higher job limits can trigger a closer assessment. Planning ahead is especially important when a major contract is approaching.
HBCF Application Document Checklist
The exact requirements depend on the applicant and assessment pathway, but a well-prepared submission may include:
Business and licence details
- current contractor licence details;
- ABN, ACN and legal entity information;
- director, shareholder and key-person details;
- business structure and related entities.
Financial information
- recent financial statements and tax information;
- management accounts and work-in-progress reports;
- assets, liabilities and supporting declarations;
- evidence supporting any proposed financial assistance.
Project information
- signed or proposed building contract;
- contract price, site address and scope of work;
- construction type, timeframe and planning details;
- current open jobs and anticipated pipeline.
Experience and risk controls
- builder experience and project history;
- supervision, estimating and quality-control processes;
- subcontractor and supplier management;
- explanations for unusual results, disputes or claims.
Tip: provide complete, consistent information. Differences between contracts, financial accounts, work-in-progress schedules and licence records often create follow-up questions and delay.
The 2026 HBCF Portal and Broker Transition
As at August 2026, icare is changing how builders and their representatives access HBCF services. The existing broker panel arrangements are scheduled to end on 31 August 2026. From 1 September 2026, builders may use the icare HBCF portal directly or nominate a trusted third party, including an insurance broker acting as a service provider, to assist with transactions.
The practical message is simple: do not wait until a contract deadline to confirm portal access, authority arrangements, eligibility status and outstanding information. Scheme processes can change, so always check the latest guidance from SIRA and Service NSW, or speak with ABS before relying on an older process.
What Does HBCF Insurance Cover?
HBCF is designed as last-resort consumer protection. Subject to legislation and the policy, a homeowner may be able to claim for incomplete or defective residential building work if the builder cannot honour their obligations because of a covered trigger. Commonly identified triggers include:
- the builder becomes insolvent;
- the builder dies;
- the builder disappears;
- the builder’s licence is suspended after failure to comply with a court or tribunal money order, where the scheme conditions are met.
The scheme includes minimum cover requirements and claim time limits. As a general guide, structural defects may have a longer claim period than non-structural defects, but homeowners and builders should rely on the certificate, policy wording and current statutory rules for the particular project.
Homeowners can verify certificates through the government’s HBC Check using details such as the certificate number, builder, licence, company or property address.
What HBCF Insurance Does Not Replace
A project certificate does not cover every risk faced by a construction business. Depending on the work, a builder may also need:
- Contract works insurance for accidental loss or damage during construction;
- Public liability insurance for third-party injury or property damage claims;
- Tool insurance for portable equipment and tools;
- Commercial motor insurance for work vehicles;
- Construction insurance arranged around the wider risks of the business.
HBCF is also not a general guarantee that every disagreement, delay or defect will be paid. Claims depend on the insured project, an eligible loss, a covered trigger and compliance with policy and statutory requirements.
Common Causes of HBCF Application Delays
- Eligibility limits do not match the project. The proposed contract may exceed the maximum contract price, construction type or open job allowance.
- Financial information is incomplete or out of date. Missing accounts, work-in-progress schedules or explanations can stop assessment.
- Business details do not match. The licence holder, contracting entity, ABN or company name may be inconsistent.
- The contract changes late. A revised price, entity, scope or address can require new information or reassessment.
- The application starts too close to commencement. Eligibility variations and complex reviews are not instant.
A broker can help organise information and identify obvious gaps, but approval, eligibility conditions and timing remain decisions of the insurer and scheme administrator. No broker can guarantee acceptance or a particular turnaround time.
How ABS Insurance Brokers Can Help NSW Builders
ABS Insurance Brokers works with builders and construction businesses to make the insurance side of a project clearer and more manageable. We can help you understand the HBCF pathway, prepare an application, coordinate information requests and consider the other construction insurance policies that sit around your projects and business.
Whether you are seeking first-time eligibility, renewing or changing limits, applying for a project certificate, reviewing an open-job position or arranging cover for an owner-builder sale, early contact gives everyone more time to resolve issues.
Call ABS on 1300 871 318 or submit the enquiry form below. Our team will discuss your circumstances and the next practical step. ABS’s ability to arrange or assist with cover is subject to applicable licence arrangements, insurer requirements and eligibility.
Watch: Home Building Compensation Fund Insurance Explained
Watch the ABS video below for an introduction to HBCF insurance, then contact our team if you need help with your own builder eligibility or project certificate.
Frequently Asked Questions About HBCF Insurance
Is HBCF insurance the same as builders warranty insurance?
In NSW, yes—these names commonly refer to the same statutory scheme. The current official term is Home Building Compensation cover. “Builders warranty insurance” and “home warranty insurance” remain widely used search and industry terms.
What is the HBCF insurance threshold in NSW?
HBC cover is generally required for covered residential building work valued at more than $20,000 including GST. Exemptions and project classifications can apply, so confirm the requirement for the particular contract.
Can a builder take a deposit before the HBC certificate is issued?
For work requiring HBC cover, the project certificate should generally be provided before the builder takes payment or starts work. Arrange cover early rather than treating the certificate as a post-contract formality.
Does a subcontractor need HBCF insurance?
A subcontractor working for a head contractor generally does not need HBC cover for that subcontract because they are not contracting directly with the homeowner. The head contractor’s obligations should still be checked.
What is the difference between HBCF eligibility and a project certificate?
Eligibility approves a builder to seek cover within defined limits and conditions. A project certificate is the evidence of HBC cover for one specific residential building contract. A builder usually needs suitable eligibility before a project certificate can be issued.
How can I increase my HBCF job limits?
You may need an eligibility review or variation supported by updated financial, work-in-progress and project information. The insurer assesses whether the business can support the requested contract size and workload.
How long does an HBCF application take?
Timing varies with the application type, complexity, eligibility position and completeness of the information. A straightforward project within current limits may be quicker than a first eligibility application or a major limit increase. Start before contractual deadlines.
How can a homeowner check HBCF cover?
Service NSW provides the public HBC Check register. A homeowner can search using the certificate number, builder or contractor details, licence number, company name or property address.
Does HBCF cover a dispute while the builder is still trading?
Not automatically. HBCF is last-resort cover and generally requires an eligible loss and specified claim trigger. Contractual disputes with a solvent, operating builder may need to follow other legal or dispute-resolution pathways.
What should I prepare before contacting ABS?
Have your contractor licence and entity details, project address and value, proposed contract, current eligibility certificate if available, open-job information and any recent correspondence from icare or an assessor. ABS can then identify the likely next step more efficiently.
Related Insurance for Builders and Construction Businesses
Builders Warranty Insurance
Explore ABS assistance for NSW builders warranty and HBCF applications.
Contract Works Insurance
Protect works in progress, materials and project risks during construction.
Public Liability Insurance
Cover for insured third-party injury and property damage claims.
Construction Insurance
Bring together essential protection for your projects, people and business.
Ready to Discuss Your HBCF Eligibility or Project Certificate?
Complete the form and an ABS team member will contact you. For urgent assistance during business hours, call 1300 871 318.
Important information: This article provides general information only and is current as at August 2026. It does not take into account your objectives, financial situation or needs and is not legal advice. HBCF rules, processes, premiums and eligibility requirements may change. Cover is subject to legislation, insurer acceptance, policy terms, limits, exclusions and conditions. Check current guidance from icare, SIRA and Service NSW before acting.
