Home Building Regulation 2014

An alternative indemnity contract under this Part provides alternative indemnity product cover in respect of loss only if a claim in respect of the loss is made to the provider during the period of specialised insurance cover.

A loss that becomes apparent in the last 6 months of the period of specialised insurance cover has an extended claim period, which permits a claim in respect of the loss to be made within 6 months after the loss becomes apparent.

Despite subclause (2), there is no extended claim period for loss that—

arises from non-completion of work, or

arises from a breach of a statutory warranty that is covered by a construction period alternative indemnity contract.

When a loss becomes apparent during the period of specialised insurance cover but a claim cannot be made during that period because an indemnified event has not occurred, a claim can be made after the period of the cover (as a delayed claim) but only if—

the loss was properly notified to the provider during the period of cover (or within 6 months after the loss became apparent in the case of a loss that became apparent in the last 6 months of the period of cover), and

the beneficiary under the alternative indemnity contract making the claim diligently pursued the enforcement of the statutory warranty concerned after the loss became apparent.

A delayed claim can also be made when the indemnified event occurs in the last 6 months of the period of specialised insurance cover (as if the covered event did not occur until after the period of cover) subject to compliance with the other requirements of this clause for a delayed claim.

For the purposes of subclause (4) (b), the following factors are to be taken into account in determining whether the conduct of the beneficiary under a alternative indemnity contract constitutes diligent pursuit of the enforcement of a statutory warranty—

whether or not the beneficiary has fulfilled the duties imposed on the beneficiary by section 18BA of the Act,

except in the case where the breach arises because of the insolvency, death or disappearance of the contractor—whether or not the beneficiary has taken all the steps that were necessary and reasonable in the circumstances to notify the relevant dispute in accordance with Part 3A of the Act,

whether or not the beneficiary has fulfilled any duties imposed on the beneficiary by section 48D (4) or (6) of the Act in relation to the investigation of the dispute,

whether or not the beneficiary has complied with the requirements of any rectification order made in relation to the dispute, as required by section 48E (3) of the Act,

whether or not the beneficiary has taken all the steps that were necessary and reasonable in the circumstances to commence and advance proceedings in a court or tribunal in relation to the relevant breach of statutory warranty,

whether or not the beneficiary has taken all the steps that were reasonable or necessary to enforce any judgment or order obtained in relation to the dispute.

A loss is properly notified to a provider only if the provider has been given notice in writing of the loss and the notice provides such information as may be reasonably necessary to put the provider on notice as to the nature and circumstances of the loss.