Five years after the NSW Design and Building Practitioners Act 2020 reshaped accountability across the construction sector, the insurance products meant to support it are still catching up. Ross Chambers, head of financial lines at Hutch Underwriting, examines where the coverage gaps sit today, what the mandatory professional indemnity requirements arriving on 1 July 2026 mean for brokers and their clients, and why the non-delegable duty of care built into the act could reshape how losses are absorbed across the entire design and construct market. With construction insolvencies running at high rates and a large cohort of building practitioners set to enter the PI market for the first time, Chambers says the window to act is narrowing fast.
The NSW Design and Building Practitioners Act 2020 commenced in part on 11 June 2020. It requires practitioners involved in regulated work to be registered, lodge designs and compliance declarations on the NSW Planning Portal, and hold appropriate insurance. The act was introduced following the evacuations of Opal Tower in December 2018 and Mascot Towers in June 2019, both of which exposed systemic failures in multi-residential building design and construction.
From 1 July 2026, the DBP Act extends to cover repair, alteration and renovation work on existing Class 3 and Class 9c buildings, including boarding houses, student accommodation, aged care facilities, and parts of hotels and motels. New buildings in those classes have been captured since July 2023, but the July 2026 changes bring existing buildings and remedial works into scope for the first time. On the same date, PI insurance becomes mandatory for every registered building practitioner in NSW.
Most design and construct policies use broad professional services definitions that do not explicitly address the DBP Act's language or obligations. According to Ross Chambers of Hutch Underwriting, the PI market has historically avoided insuring tradespeople and building practitioners with no specific engineering or design activities, leaving those now required to lodge compliance declarations on the NSW Planning Portal with few affordable options. Chambers says insurers need to start confirming their coverage stance affirmatively or negatively so policyholders have genuine certainty.
A large cohort of building practitioners who have never held PI insurance will enter the market from 1 July 2026, many of them unfamiliar with claims-made policy structures, run-off cover and policy cancellation rules. Ross Chambers of Hutch Underwriting says education will be in high demand across the broker community. While the overall premium pool is expected to see a small positive increase, downward pressure from a softening market and lower average premiums from smaller newly registered practitioners will limit the benefit. Relationships and ease of transaction may be the deciding factor for brokers competing for new placements.
The DBP Act creates a non-delegable duty of care, meaning practitioners cannot pass responsibility down the contractual chain. Ross Chambers of Hutch Underwriting says this has significant implications for portfolio performance, particularly around defence costs and vicarious liability. If losses cannot be recovered from responsible parties lower in the chain, the cost of claims will sit with the insured's policy. In a worst-case scenario, Chambers warns, the D&C insurance market could become unaffordable for all but the largest building contractors.
With construction costs elevated and insolvencies running at high rates, Hutch Underwriting applies financial analysis to every submission to gauge the likelihood of business failure within the next 12 months. This assessment feeds directly into the premium charged on a risk-by-risk basis. Ross Chambers says project delays compound exposures further, making financial viability a core factor in risk acceptance rather than an ancillary consideration.
Hutch Underwriting's Design and Construct PI product targets SME building and construction businesses working on residential and commercial projects valued up to $10 million. It includes professional indemnity and cyber coverage as standard. The product is available via Ebix Sunrise Exchange (code HUTPI) and the Steadfast Client Trading Platform, and is also Dawn-enabled. Dawn is Hutch's AI email ingestion service: emailing a proposal form to [email protected] delivers a pre-populated quote into the broker's Sunrise import queue within minutes, with no manual keying required at either end.
Ross Chambers, Head of Financial Lines, Hutch Underwriting — spokesperson on design and construct PI and DBP Act compliance; represents Hutch Underwriting, an independent, employee-owned Australian underwriting agency backed by Lloyd's and other insurers; the agency distributes products digitally through Ebix Sunrise Exchange, the Steadfast Client Trading Platform and Unmand, and provides in-house claims expertise.