18 June 2018
Dear Valued Customer,
URGENT UPDATE: CHANGES TO THE NSW HOME WARRANTY
On 14th June we received advice from HBCF there will be another price increase effective 1 July 2018.
From 1 July 2018 you must state the cost of the home warranty insurance cover in any contract to do insured
work. The “cost of cover” is the total amount of money you must pay for this insurance (including any broker
fees and taxes). This is a new legal requirement under the Home Building Act 1989 that is administered by the
State Insurance Regulatory Authority and NSW Fair Trading.
The most apparent increases are on New Single Dwellings & Duplex/Triplex certificates. Both of these
categories have increased by 45% on average. Some minor changes to premiums have been implemented on
other categories but they are nominal.
Please make sure you use our Premium Calculator on our website www.irecon.com.au which will be updated
to reflect these changes. You will need your Builder loading or discount to obtain an accurate quote. The
Irecon calculator shows the total price including all fees & charges.
Whilst the premiums have increased, our work as your broker has not. Given we calculate our fee as a
percentage of the base premium, Irecon has elected to reduce our broker fee from the current format (15% of
base premium plus $100) to 12.5% of base premium plus GST only. This will be subject to a minimum fee of
$100 plus GST.
Individual Builder weighting (discount/loadings) methodology has also changed. Please find attached your
letter from iCare/HBCF providing updated information in relation to you own personal circumstances. This
letter also provides you with confirmation of your new discount/loading effective 1 July 2018.
New application forms will come into effect from today. These forms are attached and also available on our
website www.irecon.com.au.
There are only two (2) application forms to choose from:
➢ Multiple Dwelling Project Application
➢ All works Excluding Multiple Dwellings (this form includes duplexes and triplexes)
Granny flats are now being treated as Construction Type – New Single Dwelling Construction
(Section A – page 3) which will result in increased premiums.
Where a duplex has individual values for each dwelling, a separate form must now be completed for each
dwelling. Where the duplex values are the same, only one form need be completed.
We appreciate these increases are quite significant so please make sure you quote the warranty as part of
your initial Contract process.
Should you have any questions or wish to discuss these changes further, please feel free to contact our office.
Regards,
LESLEY CONNOLLY