You can ask to use your preferred licensed builder, and you can ask your insurer about a cash settlement. But whether the insurer agrees to pay for your nominated builder, and on what terms, depends on your policy and claim. There is no blanket guarantee that every insurer must approve a chosen builder or cash settlement.
Insurer-managed repairs or cash settlement?
Under an insurer-managed repair, the insurer usually appoints and manages its repairer. You should review the scope of works, raise concerns about the proposed repairs and ask how defects or variations will be handled.
With a full or partial cash settlement, the insurer pays an agreed amount for the covered work. You then generally arrange and manage the relevant repairs yourself. This offers more choice but may expose you to cost overruns, approvals and unforeseen defects.
Questions to ask before choosing
- Does my policy allow me to nominate a repairer or request a cash settlement?
- Will the insurer approve the builder and the complete repair scope in writing?
- Does the assessment include all damage caused by the insured event and necessary compliant reinstatement?
- Are demolition, access, waterproofing, engineering, permits and concealed damage adequately addressed?
- What happens if more damage is discovered after work begins?
- Who carries responsibility for the workmanship and completion of repairs?
Before accepting a cash settlement
Request the written scope, itemised settlement calculation and any Cash Settlement Fact Sheet that applies. Obtain an independent builder's quotation where useful. ASIC's MoneySmart guidance warns that a settlement based on a preferred supplier's rates may not cover what you would pay to organise repairs yourself.
If you disagree with the scope or amount, ask the insurer to review it. You can use the insurer's internal complaints process and, if unresolved and eligible, approach the Australian Financial Complaints Authority (AFCA).
Where Brownlow Building fits in
Brownlow Building can assess the building damage, review a proposed scope and prepare a repair quotation. This helps you understand the likely work and cost before deciding how to settle your claim. We cannot guarantee an insurer will approve a particular settlement amount or builder.
Independent guidance
- ASIC MoneySmart: how home insurance cash settlements work
- ASIC MoneySmart: making a home insurance claim
- AFCA: insurance complaints
This article concerns ordinary home and contents building-damage claims, not the separate Victorian Home Warranty scheme for domestic building contracts. Always review the actual PDS and claim circumstances.
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