About BII

Building Indemnity Insurance (BII) provides important protection to people who are building or renovating a home.

BII contributes to the additional costs of completing a building project above the original contract price should the builder die, disappear or become insolvent. This includes the costs of fixing any defects in the work already performed. The customer still needs to pay the remainder of their contract price as part of the costs for the new builder. BII also covers the costs of performing rectification of defective work for projects within the 5-year statutory warranty period after completion of a home.

What work requires BII?

Under South Australia’s Building Work Contractors Act 1995, builders must take out a BII policy on all domestic construction projects where:

• the project costs $20,000* or more and requires development approval under the Planning, Development and Infrastructure Act 2016 AND
• the work is being done by a building work contractor under a contract with a customer or on their own behalf (such as speculative building work, build-to-rent or as an owner builder).

* Prior to 10 November 2025, the value of works where BII was required was $12,000.

“Domestic building work” is work involved in constructing, erecting, altering, repairing, adding to or demolishing a building that is intended to be used as a place of residence, such as houses, townhouses, units, retirement villages and some apartments.

It is also needed for other building work within, or on the boundary of, the “curtilage” of houses, such as sheds, swimming pools, verandahs and some fences that are built within a normal house block.

Exemptions to BII Requirements

The following types of work do not require BII.

• Subcontracts to another builder who is contracted to perform the work (the head contractor must meet any BII requirements) OR
• Contracts solely for demolition work OR
• Residential buildings that are over three storeys and contain two or more separate dwellings OR
• Properties solely used for short-term holiday accommodation

Work performed by a genuine owner builder does not require BII but any builders who perform work for them valued at $20,000 or more must take out BII for their work. Prior to 10 November 2025, the value of works where BII was required was $12,000.

Click here for more information on owner builders.

Insurers Offering BII in South Australia

Since 2013, in the absence of the availability of this cover at scale in the private sector, the South Australian Government Financing Authority (SAFA), through its insurance division, has underwritten BII through reinsurance agreements with insurers operating in the private sector.

SAFA currently underwrites BII through a reinsurance arrangement with QBE Insurance (Australia) Limited.

Other Private Insurers

Assetinsure Pty Ltd is a private insurer that officially launched its Domestic Building Insurance product into the South Australian market on 24 May 2023.

AB Phillips is a private insurer offering its Builders Warranty Insurance product in South Australia, which is specifically tailored to the pool, spa & landscaping sectors only.

These insurers do not form part of the BII reinsurance arrangements with the South Australian Government Financing Authority.

BII Policy Limits