Why do you want a licensed and insured contractor?
A contractor is required by law to take out a policy with Home Building Compensation Fund (previously Home Owners Warranty) on behalf of the home owner, for building and landscaping works valued at $20,000 and above (excluding GST). This insurance policy provides for the home owner a set period of cover for loss caused by defective or incomplete work in the event of the death, disappearance or insolvency of the contractor. (Read more about this at www.fairtrading.nsw.gov.au)
For any residential jobs involving building work where the labour and materials are valued over $5000, contractors must hold an appropriate licence with NSW Government Fair Trading. A contractor should hold for example:
a paving licence to lay pavers and a structural landscaping licence or builder’s licence to install any other hard-landscaping works such as bricklaying or retaining walls, unless fully supervised by the above qualified person/s.
See below on how to check if your contractor has the right licenses and insurance.
You can check your tradesperson’s licence details at www.fairtrading.nsw.gov.au. Just type the words 'licence check' in the search section and follow the prompts. If the contractor is not registered, they’re not licensed and that means not insured either.
Consumers can also check their builder's or tradesperson’s insurance and previous claims on a property through a new public register at the above Fair-Trading Website.
NSW Government Fair Trading Dept states that licensing protects you in the following ways:
you deal with a legitimate business
the tradesperson has the right qualifications for the job
you enjoy better consumer protection
you help to keep the shonks out