DBI for builders

As a practitioner, when you sign a major domestic building contract for work valued at more than $16,000, you need to ensure a domestic building insurance (DBI) policy is in place.

If this is not in place and has not been provided to the client, then the contract is conditional upon the client receiving the policy document.

Without a domestic building insurance policy, a builder cannot enforce the contract, commence work or receive any money from the client, including the deposit, until the insurance is in effect and the client has been given a copy of the insurance certificate.

The builder must give the client a copy of the domestic building insurance certificate within seven days of receiving it. 

Builders are responsible for providing their client with a copy of the DBI policy and certificate of currency covering the client’s property.

We require evidence that a person holds the required insurance or is eligible to purchase the required insurance before it can grant or renew a building registration.

Domestic building work includes, but is not limited to:

• The construction, renovation, removal or demolition of a home.
• Work associated with the construction of renovation of a home such as landscaping, paving, fencing, retaining walls, swimming pools and spas.
• The construction of garages, decks and pergolas on residential land.
• Site works for the above projects.

The BuildVic portal is the Victorian Managed Insurance Authority’s secure domestic building insurance portal where building practitioners can purchase domestic building insurance, view certificates of insurance, access their letter of eligibility and check current job limits and premium rates.

To register for access to BuildVic or for more information on DBI, contact one of the DBI distributors.

If we learn a builder is no longer covered by the required insurance, we must suspend their registration.

The effects of suspension include being unable to work as a registered building practitioner under the duration of suspension and any building permits issued in your name as the builder are suspended.

In February 2024, the Victorian Government introduced changes to the Domestic Building Contracts Act 1995 and the Building Act 1993 to give us additional powers to penalise builders if they demand or receive money under a major domestic building contract for work valued at more than $16,000.

• The first offence will apply where the conduct has been committed knowingly or recklessly. The maximum penalty level for this offence will be set at 500 penalty units (approximately $96,000) for a natural person and 2,500 penalty units (approximately $480,000) for a body corporate.
• The second offence will apply where the conduct has been committed under a standard of strict liability. The maximum penalty level for this offence will be set at 240 penalty units (approximately $46,000) for a natural person and 1,200 penalty units (approximately $230,000) for a body corporate.

Builders will be required to give a notice of suspension to any person who has a building contract with you and if you are a director of a company that is registered as a building practitioner, the registration of the company may also be suspended.

Professional engineers who hold endorsement to work in the building industry through the Business Licensing Authority will have their endorsement suspended if they are no longer covered by the required insurance.

As a building surveyor, you have a legal obligation to ensure that builders have a valid DBI policy before you issue building permits.

Under section 24A of the Building Act 1993, the Relevant Building Surveyor (RBS) must not issue a building permit unless the RBS is satisfied the named builder/building company on the building permit is identical to the named builder/building company on:

• The major domestic building contract; and
• The certificate of insurance from the insurer.

If you are engaging a contractor to carry out domestic building work where the price is more than $10,000 (including materials and labour) and the project involves more than one type of work (e.g. it is not just tiling), you and your building practitioner are required to have a formal major domestic building contract in place. The contract must meet the requirements of the Domestic Building Contracts Act 1995.

If this contracted work has a price over $16,000, you also need to ensure a domestic building insurance (DBI) policy is in place.