Social
At Honan, we’re big believers in growing an exceptional brand, business and reputation through exceptional people. People with market-leading expertise, proven results and a fierce commitment to serving their clients, but also people with creative, considered points of view and a willingness to share them. These are our challenger champions - the ones who progress, lead and succeed by doing things a little differently, delivering on promise, and proving their passion through outstanding performance. In this series, we get to know them a little better; picking their brains for exclusive industry/category insights, future predictions, and the secrets behind their success.
-01.jpg)
I undertook a commerce degree majoring in management and marketing but as I got towards the end of it, I knew it was not what I wanted to do. Upon graduation, I started looking for a job and somehow landed in a niche part of insurance: Builders Warranty (Domestic Building Insurance). I started my career at Master Builders Insurance Brokers and worked my way up to Team Lead over 6 years before I joined BRIC, a Honan company, just under 18 months ago.
With clients ranging from small domestic builders to large commercial ones, we pride ourselves on being a one-stop-shop for builders, with construction our speciality, which sets BRIC apart from other brokerages. BRIC is also one of the five panellists for the Victorian Managed Insurance Authority (VMIA) providing Domestic building insurance (DBI). And we are now the only provider of Commercial Structural Defects via Liberty Insurance for commercial builders.
Insurance can be complex and we understand that builders can get confused about the amount of coverage they have under their construction risk insurance, often believing this is the same they have/need for their Domestic Building Insurance (DBI). However, this is not the case and it's so important for builders to be able to differentiate between these two insurance types. Explaining the difference and assisting them in getting the appropriate coverage is where we shine.
Builders Warranty/DBI, is a mandatory insurance in VIC, NSW, SA, WA and ACT for any residential works above a certain amount. The value of the works threshold is different in each state, in Victoria it’s $16K.
This policy requirement is purely there to protect the homeowner if their builder dies, disappears, or goes insolvent. It’s what we call a “last resort” policy. If any of the above-mentioned triggers occur, the homeowner can make a claim on their policy to complete their home or fix up any defects within a 6-year warranty period.
Although it doesn’t protect builders, the process of getting DBI insurance is a great assessment tool for the longevity of a residential construction business. It ensures builders are not over-extending themselves by entering too many contracts that they can’t fulfil, resulting in insolvency.
In the last few months, we have seen the industry stabilise somewhat with interest rates going down and there is speculation that the cost of labour and materials will also follow suit.
Our advice to builders is to be mindful when factoring in the costs of materials, labour and time delays into their construction contracts. It’s a time to work with the market and grow organically as a business. Whilst this may mean that builders take on less work it will allow them to finish work in a timely fashion and be operationally sound.
We are constantly trying to educate our builders about DBI, and it’s surprising that not many of them are aware that this product protects the homeowners they contract to and not the builder.
When it comes to DBI, it can be challenging for insurers to assess a builder’s allowance and ability to increase their commitment to several jobs at a time, due to the current market conditions combined with insurers’ risk appetite. The final decision rests with the insurer, making it difficult for us to give advice. However, our team spends a lot of time making sure that what the client is asking, is what builders need for upcoming works and it fits within their current financial capabilities too.
We always suggest talking to us (or your current insurance broker) if you are thinking of making any changes to your business. I believe that, especially in construction, talking to your broker is as important as talking to your accountant.
We should hopefully see the market continue to stabilise in the coming 2 years. We are already seeing the effects of interest rate increases being paused and labour and material costs steadying, resulting in increased building activity. Our focus will be on assisting our clients to grow at a steady speed and avoid over committing themselves.
For me, it’s all about listening and providing excellent customer service. I always say that if builders wanted to do paperwork they would’ve chosen another profession, so if we can make it a little bit easier for a client to run their business, that’s a win!
DBI is such a niche product but so important for residential builders which is one of the key industries in Australia. My team is well versed in DBI which means we can help builders make healthy decisions for their business. Our clients may not always like the answer they get but we have their best interest in mind; we want their business to be around for years to come.
I am really excited to be a part of this industry, it’s forever changing which makes it both exciting and challenging. Taking our clients on that journey is what I am most passionate about. Delivering unfavourable outcomes on occasion is hard but that’s just part and parcel of it and I am fortunate enough to have an amazingly supportive husband. He is my biggest cheerleader and somehow can always find the positives in life.
