ICA has released a series of fact sheets giving the insurers’ side of the builders’ warranty insurance issue. The move comes as the insurers try to quell a backlash against the schemes which has been partially fuelled by misinformation and gossip.

NSW home builders marched to Parliament House in Sydney last week to protest against the inadequacy of the warranty schemes and the performance of the insurers. Royal & Sun Alliance has attracted the most criticism. It is demanding that builders prove their capital adequacy before it will give them cover. Builders have accused R&SA of forcing them to sell assets to prop up their businesses’ balance sheets.

Nick Kirk, General Manager Specialty Businesses at Royal & Sun Alliance, said home warranty insurance is a legislative requirement designed to protect consumers. “Our financial criteria ensures that builders are financially sound and able to complete the jobs they contract for.”

“By insurers working closely with builders to ensure a reliable and financially sound building company, everyone benefits. The builder remains solvent and profitable, the consumer gets their house built and the suppliers and trade contractors to the builder are all paid.”

ICA’s “Home warranty insurance – myths & facts” reveals a few home truths, like the fact that less than 2% of the active 37,000 builders are declined cover and less than 3% of them are awaiting processing of their applications.