You take out the policy.
It only answers if you can’t.

Building Indemnity Insurance (BII) is compulsory insurance that a builder must take out for major domestic building work under the Building Work Contractors Act 1995 (SA). It is triggered where the work is carried out by a building work contractor, the contract value is $12,000 or more, and the work requires approval under the Planning, Development and Infrastructure Act 2016. Subcontracts and demolition-only contracts are exempt, and the scheme does not currently cover high-rise apartments or residential buildings over three storeys containing two or more dwellings.

The structure catches builders who have not read it closely: BII is last-resort cover. It does not respond to every defect or dispute. It responds only when the builder has died, disappeared or become insolvent before the work is complete. In an ordinary dispute with a solvent, contactable builder, the scheme does not answer and the builder remains directly responsible for the work. That is worth being plain about with clients, so nobody mistakes the certificate for a general guarantee.

Who it protects, and for how long

The cover protects the customer, and it travels with the home. It covers rectification of defective work for up to five years after completion, for the original owner and any subsequent owner. Where a builder fails before finishing, the cover meets the additional cost of completing the project above the original contract price, including fixing defects in work already performed. The customer still pays the remainder of their contract price; the scheme covers the shortfall above it, not the whole job.

Deposits, certificates and the register

• The builder takes out the policy and passes the cost to the customer, and must give the customer a copy of the certificate of insurance before commencing work.
• Deposits before cover are not protected. Until the insurance is taken out, any deposit or other payment made to the builder is not covered by BII. To limit that exposure, builder deposits are limited, usually 5 per cent plus some third-party costs.
• A certificate must be lodged before work starts. The certificate of insurance must be lodged with the relevant authority before work commences, and the relevant authority must check BII is in place before granting building consent.
• There is a register to check. QBE maintains an online register so a customer can check whether a BII policy is in place.

Who provides it, and the limits

Almost all BII is provided by QBE Insurance (Australia) Limited under an arrangement fully underwritten by the SA Government. The statutory minimum cover under the Building Work Contractors Act 1995 is $80,000, and both insurers operating in SA provide a policy limit of $150,000 per project, with a $400 excess. These figures, and the insurer arrangements, are as reported in the March 2025 review, so confirm each against the current SA scheme before relying on it. This is general information, not legal or financial advice.

What the March 2025 review found

A review of the scheme by the SA Government, reported in March 2025, identified structural limitations: the low $12,000 attachment point, the exclusion of non-habitable structures and common areas, and gaps around multi-storey buildings, owner builders and developers. It found that deposits, and the absence of a deposit-protection trigger (a so-called fourth trigger), leave owners exposed before cover commences, and it raised the adequacy of the $150,000 policy limit as a subject of concern. Treat the review’s recommendations as proposals, not current law; confirm which, if any, have since been enacted against the current SA scheme.

A note on currency: the figures and findings above are drawn from an official SA Government BII review report dated March 2025. Some of them are proposals, not yet law, scheme settings change over time, and this is general information, not legal or financial advice. For how South Australia compares with the other states’ schemes, see our state-by-state home warranty guide, and for two schemes in depth, the NSW HBCF eligibility guide and the Victorian DBI guide.

Nothing in software changes the scheme. VIABUILD does not provide, arrange, price or advise on insurance, and it does not deal with the SA scheme or with QBE. What software changes is whether the records the scheme runs on exist when you need them, and whether the business stays clear of the trouble the scheme exists to catch.

The BII pressure points are documentary and financial. Proving what the contract price and variations were, showing what was built and when, holding certificates and inspection records across a five-year tail, and answering a claim assessor from files rather than memory. Beyond that, BII is a last-resort scheme that responds when a builder becomes insolvent, so a business that keeps its costs and cashflow visible is simply less likely to hit the trigger the scheme exists for. That is not insurance and it is not advice; it is running a tighter business.