Removal of mandatory defects insurance for non-domestic plumbing as a condition of registration


Red tape issue

A licensed plumber is required to take out insurance against defects in non-domestic  plumbing works. The insurance is known colloquially as the Victorian Plumbers endorsement. This insurance imposes a cost of more than $5 million on the industry. This requirement has been seen as an unnecessary impost on commercial entities, who are adequately protected through contract rights and commercial litigation – therefore not utilising this insurance product.

Current status

The Department of Environment Land Water and Planning (DELWP) is currently working with industry to:

  • identify how these commercial businesses and large commercial building owners contract and transact;
  • understand the frequency of claims related to defects liability; and
  • gather evidence to understand the implication for the broader regulatory regime and quality assurance processes if the requirement for defects liability for non-domestic work is removed.  

To maintain public interest, implementation of any change will depend upon Government being satisfied that a reduction in regulatory burden is achieved without compromising consumer protection or exposing other plumbing practitioners to unreasonable risk.