The short answer
In NSW, principal contractors must insure residential building work priced over $20,000 including GST under the home building compensation scheme. Statutory warranties apply even if they are not in your contract, for 6 years for major defects and 2 years for other defects.
New South Wales only. Summarised from SIRA and NSW Government pages. Check the current pages for the exact wording and any recent changes.
Confidence: likely. These facts come from official pages that we found by search and did not read in full. Check the linked source before you rely on a figure.
When insurance is required
The builder or principal contractor must insure residential work above $20,000 including GST. If a project is split across several contracts, the amounts are added together. Insurance should be in place before work starts or any payment, including a deposit, is taken.
Check the certificate first
Ask for the insurance certificate and confirm it is valid before you pay a deposit.
Statutory warranties
Statutory warranties run for six years for major defects and two years for all other defects, starting from completion.
Common questions
When is home building insurance required in NSW?
For residential building work priced over $20,000 including GST, according to SIRA.
Sources
- SIRA: home building compensation, checked 11 November 2026
- SIRA: insurance obligations for residential building works, checked 11 November 2026