Home Warranty Insurance when promises of low docs turns into chaos and despair. Otherwise what can go wrong!October 7, 2018 6:38 pm 4 Comments
2018 a year of failed experiments sees owner builders who choose low docs, non-Australian insurers, find themselves front and centre in home warranty disputes.
Home Warranty Insurance does not insure an owner builder, but insures the future purchaser of your home against faulty or defective workmanship during the home warranty period. There is no insurance for the owner builder; that’s how home warranty works.
March 2017 A and F (Reservoir, Vic) brought what they thought was standard owner builder insurance from a company promoting itself as a home warranty specialist. Their upcoming auction day was all consuming, and with add pressure to complete their Section 32, failed to thoroughly investigate their insurance options. “it’s all the same was the sales pitch” from the call centre commission sales person. This statement is not only an uneducated opinion but untrue. Insurances are never the same, because all insurance company drive profits before benefit’s. A and F (names withheld), were convenience by the call centre sales pitch, and so afterall, what can go wrong?
September 2018, 8.12pm, the owner builder receives a call from the long forgotten purchaser of their owner built home. The call informed them of several problems: the front 2 bedroom floors and hall way were buckling and starting to lift. The home was deemed unsafe for their family, and in need of urgent action. Furthermore the purchaser indicted financial compensation for added relocation and inconvenience costs also. Remembering their owner builder insurance purchase, they quickly shifted responsibility back to the insurer. Very quickly though and following a very short telephone call with what they thought was their home warranty insurer, the owner builder was informed the insured is the purchaser of their home and not them. Wow, now what?
Lesson 1: Low-docs means in a urgent situation an owner builder has no recourse with the insurer, and is not regarded as their client for claims.
Lesson 2. Lo-docs translated into the insurer now demanding the owner builder provide the complete owner builder construction and renovation file, which in this matter occurred nearly 2 years earlier.
Lesson 3. With the low docs insurer lacking incentive to pay a claim, they started to drag their feet responding in any meaningful manner, placing added pressure on both the insured and purchaser, and leaving a very unprepared owner builder exposed.
This matter remains unresolved today, and places the owner builder in a very difficult position indeed, all because of false promises of “low docs; but what can go wrong”!
Home warranty Insurance can be a long term sentence for owner builders. And whilst selling, and then settling a sale may be a heavy weight lifted off the owner builders back, home warranty responsibility continues for the duration of warranty period. At any time during the home warranty period (up to 6.5years), the purchaser of your home can call and request a repair or complain about faulty workmanship or unfit for purpose situation.
Qtrust’s core client promise is only offer first class, Australian based and located insurance products. Home warranty insurances is all Australian, Victorian government owned and managed insurer (Victorian Managed Insurance Authority) for unsurpassed security and consumer protection.
Qtrust Home Warranty Central Call 1300 798 991
This post was written by Technical Underwriting Centre