Abstract
For decades, Latent Defects Insurance has been offered to Building Industry stakeholders and protecting consumers. It has not been readily available in Australia. Now, with Resilience Insurance, this has changed.
Content
Latent Defects Insurance (LDI), also called Decennial Liability Insurance (DLI), originated in early 19th-century France. In 1804, under the French Civil Code, French law mandated that builders were liable for quality issues in completed buildings for ten years. This system established builders’ responsibility for construction quality and provided legal protection for the rights of building owners.
In 1978, France enacted the French Insurance Code, which provided legislative support for mandatory Decennial Liability Insurance (DLI). Currently, more than 40 countries and regions worldwide have drawn inspiration from the French experience and model, making DLI a compulsory insurance type and a crucial element of their local building quality assurance systems.
Resilience Insurance has launched Australia’s first Latent Defects Insurance (LDI). This is a game-changing property insurance product for homeowners and strata communities. The LDI product is a first resort policy that provides insurance protection for structural defects and waterproofing defects in buildings for a period of 10 years after completion of construction. This protection was previously unavailable to consumers or industry, and it provides unequalled consumer confidence in the quality of building for purchasers while eliminating the destructive and growing litigation business model operating across the construction industry.
Supporting the significant regulatory reform in NSW, LDI is one of the construction industry initiatives under the administration of the Office of the NSW Building Commissioner. The product aims to provide insurance coverage for apartment owners, alleviating litigation risk for participants in the construction sector, and ensuring the delivered apartment buildings meet quality standards. Resilience Insurance’s LDI has been approved by the NSW Department of Customer Service as a form of security under the Strata Building Bond and Inspection Scheme in October 2022.
