The improvements icare are making will reduce the complexity, processing time and costs in the insurance eligibility process for small businesses in the residential building industry. This improved eligibility process will commence from 1 July 2022.
New eligibility process will be quicker and easier
Currently, when applying for eligibility, we require a full financial submission along with substantial additional information from builders (except system-reviewed builders) to complete the review. This is an intensive process and can take up to a month for a builder to receive a determination.
Following the 2020 Independent Pricing and Regulatory Tribunal (IPART) review of the HBCF and our own Customer Advocate engagement with builders, icare undertook a review of the eligibility process. We listened to builders advising the process was too complex, scheduling was sometimes challenging, and effort should be focused on high-risk builders.
The new model will allow:
- faster processing for the majority of builders
- reduced administrative and information burdens on customers
- more consistency and fairness in outcomes, ensuring most builders will see a rise in the amount of eligibility they will be able to secure while placing appropriate limits on the highest-risk builders.
The new eligibility process involves running a simple risk-based credit check which has reduced the need for some of the detailed financial information the old process requires. This new process is also faster and we will usually respond within 48 hours with our determination, based on an Eligibility Score.
This service will continue to be obtained through our panel of approved distributors.
We anticipate that approximately 94 per cent of the builders (those currently in small and system-reviewed segments) in HBCF portfolio will qualify for the new assessment, while the remaining builders will have greater underwriting focus and support for progressing through the current eligibility process.
Small and system-reviewed builders will make the transition to the new process starting from 1 July 2022 and through the next one to three years as their existing eligibility expires and requires renewal or reassessment.
These changes will also bring icare HBCF in compliance with the new regulatory guidelines issued by the State Insurance Regulatory Authority (SIRA) in December 2021. The new guidelines are Home building compensation (eligibility) insurance guidelines (2021-762) (PDF, 0.6MB).
We are continuing to work with SIRA to finalise all the details and will update distributors and builders on these through March to June 2022.
You can learn more about the changes by reaching out to us at firstname.lastname@example.org