In November 2016, reforms to HBCF were announced.
- Risk-based pricing
The introduction of risk-based pricing means building contractors are offered premium prices that reflect their individual level of risk. This will reduce the subsidisation of higher-risk contractors by their lower-risk counterparts.
Risk-based pricing also provides an incentive for building contractors to reduce their risk to obtain lower insurance premiums, thus providing better premium prices to homeowners.
The first change to pricing commenced on 3 April 2017 and the second on 3 October 2017. This included new base rates and the introduction of builder risk based pricing. There will be further premium increases on 2nd October 2018.
- Removal of Broker Distributor Commissions
icare hbcf has ceased paying commissions to broker distributors effective from 3 April 2017.
This change has brought the hbcf in line with icare Workers Insurance which does not pay commissions. Broker distributors have adopted a fee-for-service model where they now charge builders with competitively-set fees.
Broker distributors’ fees will be separate to the premium paid for hbcf insurance. Broker distributors decide how much they charge for their services independently and it is a matter between the broker distributor and their builder clients.
