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The cladding crisis has had a significant impact on the insurance landscape for building surveyors in recent years. Many businesses completed bulk notifications of circumstances to their Professional Indemnity insurer in or around 2019, seeking coverage for potential claims arising from cladding-related issues. However, since then, insurers have not consistently provided broad cladding coverage, leaving building surveyor businesses uninsured for new issues that may emerge. In this article, we share the latest update on cladding coverage, regulatory responses, and we explain how we can assist with comprehensive insurance solutions for building surveyors.
Historically, regulators across Australia have responded inconsistently to insurance exclusions for cladding-related claims. Specifically, Queensland (QLD), New South Wales (NSW), and Victoria (VIC) have allowed building surveyors to have an exclusion on their Professional Indemnity insurance policies. However, other states and territories have either remained silent on the matter or relied on more general conditions. The lack of consistency in regulatory approaches has created uncertainty and challenges for building surveyors seeking appropriate insurance coverage.
To address the concerns around insurance exclusions, regulators in QLD and NSW set a deadline of 30 June 2023 for building surveyors to obtain appropriate coverage. However, recognising the complexity of the issue and the challenges the industry faces, these deadlines have recently been extended. QLD extended the exemption for 24 months, while NSW extended it for 12 months. These extensions provide additional time for building surveyors to secure comprehensive coverage.
As trusted insurance advisors, we understand the importance of securing the best possible coverage for building surveyors. At Honan, we advocate for insurance solutions that not only meet regulatory requirements but also address the specific exposures our clients face. We can provide building surveyors with comprehensive coverage that includes various aspects of cladding-related risks, including residential work and forward coverage. We achieve these results through a mix of open market placements and exclusive underwriter arrangements.
At Honan, we offer tailored insurance options designed to meet the unique needs of building surveyors. Our solutions include a wide range of cladding coverage aspects, ensuring that potential gaps are addressed. We work closely with our clients to identify their specific requirements, assess their risks, and provide insurance policies that offer comprehensive protection.
We invite any building surveyor facing challenges in securing suitable insurance coverage to reach out at any time.
Travis Gauci
Head of Professionals
