Insurance · NSW
HBCF insurance: what owners must verify
What the Home Building Compensation Fund is, when cover is required, and what a NSW homeowner should confirm before paying a deposit. Draft, pending review.
Last updated 2026-07-12
In short
The Home Building Compensation Fund (HBCF) is a NSW scheme managed by icare that compensates homeowners as a last resort when a builder dies, disappears, becomes insolvent, or has their licence suspended. A licensed contractor doing residential work over $20,000 must hold HBCF cover before starting work or taking any money, including your deposit. Confirm a certificate of insurance exists for your specific project.
As at
The Home Building Compensation Fund (HBCF) is a NSW scheme, managed by icare, that provides a last-resort compensation scheme for homeowners faced with incomplete or defective residential building work where the builder has died, disappeared, become insolvent, or had their licence suspended for failing to comply.[2]
| Question | Answer |
|---|---|
| When is cover required? | Residential work over $20,000 in NSW |
| When must it be in place? | Before any work starts or any money is taken, including the deposit |
| Who manages the scheme? | icare (NSW) |
| What to confirm | A certificate of insurance for your specific project, not just eligibility |
Source[1]
When cover is required
A licensed contractor taking on residential work over $20,000 needs HBCF cover, and must obtain it before starting any work or taking any money under the contract - including the deposit.[1]
What to verify before you pay
- That a certificate of insurance exists for your specific project - not just that the builder is eligible for cover
- That the certificate is in place before you pay a deposit or any money under the contract
- That the name on the certificate matches the name on your contract and on the builder's licence
Source[1]
Eligibility is not insurance
A builder being eligible for HBCF is not the same as your job being insured. Eligibility means the builder can apply for cover; a certificate of insurance is issued for each individual project. Confirm the certificate for your job, not eligibility in general.[2]
Where this fits
HBCF is one record among several. It sits alongside the builder's licence and the company's status on ASIC. We help you find and read each record; we do not provide insurance or advise on your contract.
Sources
- A licensed contractor taking on residential work over $20,000 needs HBCF cover, and must obtain it before starting work or taking any money under the contract, including the deposit. Service NSW - Home Building Compensation Fund (HBCF) (retrieved 2026-07-04)
- The HBCF is a NSW scheme managed by icare that provides a last-resort compensation scheme for homeowners faced with incomplete or defective residential building work; a certificate of insurance is issued for each individual project, distinct from a builder's eligibility for cover. icare - What is icare HBCF (retrieved 2026-07-04)
Property Assurance is an independent information service. We are not a government body, insurer or credit provider. This guide explains public records; it is not legal or financial advice.
Common questions
- When is HBCF insurance required in NSW?
- For residential building work over $20,000. The licensed contractor must obtain HBCF cover before starting any work or taking any money under the contract, including the deposit.
- Is builder eligibility the same as being insured?
- No. Eligibility means the builder can apply for cover. A certificate of insurance is issued for each individual project. Confirm the certificate for your job, not eligibility in general.
- What should I check on the HBCF certificate?
- That a certificate exists for your specific project, that it is in place before you pay any money, and that the name on it matches the name on your contract and the builder's licence.
Checking a specific builder? See builders we have checked in New South Wales.
See what the registers say
14,722 Australian companies entered external administration in the 2024 to 2025 financial year, the highest annual number on record.Australian Securities and Investments Commission (ASIC), Corporate Insolvency Update (issue 37)
Reads the public registers directly. Sources named and dated.