There are fears the construction sector could come to a ‘screaming halt’ as a national insurance crisis bites Tasmanian building surveyors
THERE are fears Tasmania’s building industry could come to a “screaming halt” within months as building surveyors struggle to cope with skyrocketing insurance costs.
Tasmanian firms have reported being charged 300 per cent more for their professional indemnity premiums than the previous financial year, as the industry nationally grapples with a crisis stemming from problems with combustible cladding in the major cities.
Some private building surveyors and engineers are now having to consider their immediate future in the industry as a result of not being able to afford indemnity policies, while others are set to receive their insurance notices in the coming months.
“The concern is we’re not going to have enough building surveyors, which will slow down work,” Master Builders Tasmania executive director Matthew Pollock said.
Philip Connors, whose firm Protek is one of the biggest building surveyors in the state’s North, said his yearly premium had this week increased to an “untenable” $80,000 from $25,000, while his $5000 excess had soared to $50,000.
All insurers have now stopped offering full professional indemnity cover for building surveyors and most have ramped up premiums as a result of cladding fires in buildings in Melbourne and Sydney which led to huge payouts.
Tasmanian surveyors say they are also paying the price for “spurious” claims from property owners without warranty insurance over defects in building work.
“The lawyers have cottoned on to the fact we’re an easy target and the insurance companies will pay out for expediency, rather than take it to court, even when you’re not responsible,” Mr Connors said.
“The natural thing flowing from this is businesses are facing the reality that they’ll have to close their doors.”
Gabriel Barnes, director of the Launceston-based Metrics Group, said the loss of several building surveyors had “the potential to bring the industry to a screaming halt”.
“If you don’t have an insured building surveyor that is currently licensed on your project, you actually can’t continue on your project because the building surveyor is effectively the onsite regulator on your project,” he said.
“Frankly, mate, I might not even be here come September when my insurance is due.
“I can’t even get a quote off my insurer until September because — and this is straight out of their mouths — ‘it’s a moving feast from day to day’.
Building and Construction Minister Elise Archer said she would push for a national solution to the issue when she meets her mainland counterparts at a building ministers forum next week.
Ms Archer said she had already requested a briefing on the issue since taking on the portfolio late last month and plans to meet industry representatives this week.
“It is important to note that Tasmania has specific liability protection for building surveyors in the performance of their statutory role, in accordance with the Building Act 2016,” she said.
“Building practitioners are also still able to obtain professional indemnity insurance policies, allowing them to operate in accordance with Tasmania’s occupational licensing requirements.”