More than seven years after the evacuations of Sydney's Opal Tower and Mascot Towers shattered public confidence in apartment construction, Australia's two largest states are in the final legislative stages of a home-grown answer: decennial insurance, a 10-year, first-resort cover for serious building defects. Last month, Victoria passed the Building Legislation and Treasury Legislation (Tax Relief) Amendment Act, allowing developers of apartment buildings of more than three storeys to take out decennial insurance as an alternative to a developer bond. In NSW - where the cover is called decennial liability insurance (DLI) and was first legislated in 2022 - the Fair Trading and Building Legislation Amendment Bill 2026 is awaiting passage through the upper house. Construction lawyers say it widens the cover by replacing the "serious defects" trigger with a broader "relevant defects" definition.
But a question hangs over the reform agenda: Is the cover both governments are demanding actually available and commercially viable? Some sources consulted by Insurance Business suggested the ambitions in Sydney and Melbourne run wider than what the market currently offers. Corey Nugent (pictured), CEO of Resilience Insurance, whose offering is called latent defects insurance (LDI) which is understood to be the only such product currently sold in Australia, rejects that premise entirely - starting with the alphabet soup.
"There is no difference between decennial liability, decennial insurance, latent defects, or inherent defects insurance," Nugent told Insurance Business, when asked if the different names are describing the same product. The "decennial" label is borrowed from France, where the cover has operated for decades.
The harder question is scope. NSW's published material envisages cover extending well beyond structure - the Building Commission NSW describes a policy covering critical common property elements including the building's structure, fire safety systems and waterproofing for up to 10 years - territory some LDI products have not always reached. IB put it to Nugent that a gap exists between the legislation's ambitions and the product on the market.
Nugent said the product his firm introduced into Australia around 2022 carried limitations in its original form but has since been expanded to match what NSW legislated.
"Waterproofing, fire, mechanical, electrical, plumbing - all of those elements the government is looking for are included in the Resilience LDI product," he said.
Resilience is closer to the reform process than most. The firm sat on the NSW Government's Ministerial Advisory Panel on decennial liability insurance that was chaired by past Insurance Council of Australia (ICA) president Gary Dransfield. Nugent said it also sat on the equivalent Victorian panel and has worked with that state's Building and Plumbing regulator for years.
Not every underwriter shares Nugent's optimism. Ryan Specialty Latent Defects, part of Ryan Specialty Underwriting Managers (RSUM), has been seeking Building Commission NSW approval since 2023 and said in a recent LinkedIn post that it is resubmitting its policy following the legislative shift from "serious defects" to "relevant defects". The firm - which has opened an Australian office and is finalising its Australian financial services licence - stated bluntly that "no approvals are currently imminent" in either state and that it will only launch once unconditional regulatory approval is secured.
That goes against Nugent's assessment. He told IB he is quite confident one or more products are extremely close to approval in NSW, attributing the delay not to the products but to parliamentary timing and the enabling regulation, before Parliament since February 2026, that was listed first on the upper house business list and narrowly missed passage at the last sitting. Approval would allow the cover to be sold as an alternative to the NSW strata bond, rather than alongside it. Nugent argued the stakes of that switch are best illustrated by the disaster that started it all: a 2% bond lasting two years, he said, would have been inadequate for Opal Tower on both quantum and duration, where a 10-year LDI policy would have responded to both.
Some stakeholders have also queried Nugent's seat at the policy table. IB asked whether advising governments on a scheme while selling the only product in that market amounted to a conflict of interest? Nugent said the panels in both states drew from every corner of the supply chain including consumer groups, strata bodies, lobby groups, lawyers, architects, engineers and rival insurers, including, in Victoria. IB has spoken to several sources about this. Another source said there would have been no commercial advantage from being on the government panel. Others disagree.
"We had no greater influence than anyone else," said Nugent.
For brokers, particularly those advising developers and construction clients, the practical timeline matters more than the politics. Victoria's decennial insurance scheme is due to start on or before December 1 2027 and because the cover attaches at completion, Nugent said brokers can begin educating clients now, with government approval only needed before buildings complete. Whether the approvals arrive on his timetable or Ryan Specialty's is the question the next parliamentary sitting may answer.
