Home Warranty Insurance Scheme Board

Role

The Home Warranty Insurance Scheme Board was established to oversee the operation of the home warranty insurance scheme. This was a primary recommendation of the NSW Home Warranty Insurance Inquiry in September 2003.

Following commencement of the Home Building Amendment Act 2004 on 1 September 2005, the Scheme Board was established under Part 6 of the Home Building Act.

The functions of the Scheme Board are to:

advise the Minister on guidelines for issue under section 91A of the Home Building Act 1989
monitor the operation of the scheme established under this part with respect to home warranty insurance and to provide advice and to make recommendations with respect to the scheme
provide advice to the Minister with respect to any other matter referred to it by the Minister.

In performance of function 2 above, the Scheme Board is required to monitor the operation of both the current and the former (pre 1 July 2010) privately underwritten home warranty schemes.

Membership

The Scheme Board presently consists of six members being the Director-General of the Department of Finance and Services (or a nominee) and five people appointed by the Minister with knowledge or experience in insurance products or commerce. The term of appointment of the current membership of the Board expires on 31 December 2011.

The current membership of the Scheme Board is as follows:

Chairperson

Mr Greg McCarthy

Deputy Chairperson

Ms Penny Le Couteur

Members

Mr Rod Stowe, Commissioner, NSW Fair Trading
Ms Susan Clark
Mr Matthew Curll
Mr Alan Mason

Activities

The Scheme Board meets bi-monthly and has overseen the development of:

conditions of approval for insurers
market practice guidelines and claims handling guidelines
an industry deed with the former private insurers
arrangements for the reporting of data by insurers.

As part of its ongoing scheme monitoring role, the Scheme Board is examining how the scheme may be improved for the benefit of homeowners and builders. From September 2007, the Scheme Board began publishing information on the operation of the scheme, based on data provided by insurers, which can be accessed in PDF format under the heading below - Home Warranty Insurance Scheme Information - Scheme data.

The Insurance Services Unit provides executive support to the Board and manages Fair Trading’s responsibilities under the Home Building Act in relation to the home warranty insurance scheme.

Contact

NSW Fair Trading
Home Warranty Insurance Scheme Board
PO Box 972
Parramatta NSW 2124
Tel: 13 32 20
Fax: 9895 0838
Email: HWISchemeBoardSM@services.nsw.gov.au

Home Warranty Insurance Scheme data

NSW Fair Trading and the Home Warranty Insurance Scheme Board have responsibilities under the Home Building Act 1989 in administering the home warranty insurance scheme in New South Wales. In order to carry out these responsibilities, Fair Trading and the Scheme Board collect data on claims and policies from insurers in order to be able to monitor the operation of the scheme.

This data is used to produce information to:

inform stakeholders and the general public of the financial progress of the scheme
assess the affordability and viability of the scheme
advise the responsible Minister and the Government on the scheme, including investigation of policy matters (eg. possible changes to the scheme)
assist in the monitoring of an insurer’s compliance with their conditions of approval including compliance with the market practice guidelines and claims handling guidelines.

The data collected can also be used to produce information to assist insurers in managing their business, as industry-wide information is useful to them.

Commencing with the March 2007 quarter, information on the operation of the scheme is published below. NSW Fair Trading is experiencing some delays in the publication of the home warranty insurance data. It is expected that current information will be available in the near future.

View or download the scheme report in PDF format:

Overview report

Further information on the operation of the scheme is available. View or download in PDF format:

the June 2010 Overview Report (size: 283kb) - data to 30 June 2010
the April 2010 Overview Report (size: 232kb) - data to 30 June 2009
the September 2009 Overview Report (size: 233kb) - data to 30 June 2008.

Industry Deed

The Home Warranty Insurance Industry Deed is an agreement between the Government and the former private insurers approved under the Home Building Act 1989 to provide home warranty insurance in NSW.

The Deed sets out the Government’s commitment to consult with insurers on any changes to the home warranty insurance scheme such as changes to the legislation and the market practice and claims handling guidelines required to be complied with by insurers as part their conditions of approval.

In turn, the insurers have made commitments in relation to the maintenance of systems and processes; portfolio transfers and assignment of liabilities.

All private insurers who were approved to provide home warranty insurance in NSW are signatories to the agreement.

The development of the Deed was overseen by the Home Warranty Insurance Scheme Board and commenced on 30 December 2005.

View or download the Home warranty insurance Industry Deed in PDF format (size: 97kb)

Exchange of insurance information

NSW Fair Trading and the Australian Prudential Regulation Authority (APRA) have entered into an information sharing arrangement. The arrangement assists in the monitoring of the financial solvency and stability of insurers approved to provide home warranty insurance in NSW.

Under the conditions of approval to operate in New South Wales, insurers need to give authorisation to NSW Fair Trading for the release of information. This authorisation allows APRA to provide NSW Fair Trading with information or documents under the Australian Prudential Regulation Authority Act 1998 regarding the insurer's home warranty insurance business or the insurer's solvency. It also allows NSW Fair Trading to provide information and documents relating to the insurer’s home warranty insurance business or the insurer's solvency to APRA.

View or download the Memorandum of understanding in PDF format (size: 708kb). The memorandum has been extended to 22 June 2013.

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