Home Warranty Insurance (HBCF) Eligibility for NSW Builders

The home warranty rules every NSW builder needs to know.

In NSW, home warranty insurance is called Home Building Compensation (HBC) cover, provided through icare's Home Building Compensation Fund (HBCF). The NSW Government says that if you are a licensed builder or tradesperson, you must get HBC cover for each home building project over $20,000 including GST.

Timing matters. It is illegal to ask for a deposit or any other payment under the contract until the cover has been taken out and the homeowner has been given the certificate. If your eligibility is stuck, so is your next job.

icare changed the eligibility rules on 2 March 2026

icare's HBCF Eligibility Manual (Version 12) took effect on 2 March 2026. The big changes for builders:

• Most builders are assessed automatically. Builders with an open job value up to $12 million can qualify through an Automated Scorecard Review (ASR) that uses credit bureau data — icare says it "doesn't require you to send financial documents". Decisions usually come in about 2 business days, and ASR eligibility lasts three years.
• Some builders still need a full manual review. That applies above $12 million open job value, to builders whose score is too low, and to builders moving between tiers. A manual review needs full financials and can take up to 30 business days.
• You no longer need a distributor. Builders can apply themselves through the HBCF Portal, or authorise a Service Provider — icare names "a broker or your accountant".

Eligibility tiers (open job value)

Your certificate of eligibility also sets a maximum contract price for each type of work, and — for manually assessed builders — a limit on the number of open jobs.

What icare looks at in a manual review

When a manual review applies, icare's Manual lists the documents it expects, including:

• Three years of tax returns or externally prepared, signed financial accounts
• Interim management accounts (no more than six months old) if your last annual accounts are over 12 months old
• Aged debtors and aged creditors listings at balance date
• ATO statements of account for GST and income tax, including any payment plans
• Finance facility confirmations, related-party loan breakdowns and, where relevant, the trust deed
• A WIP schedule and, if you want a higher limit, a 12-month project pipeline forecast

The financial benchmarks icare publishes

• Adjusted net tangible assets (ANTA): the Manual sets a minimum threshold of 3 per cent, assessed against the turnover icare assumes for your eligibility.
• Adjusted current ratio: icare's benchmark is 1 or more — current assets covering current liabilities, after icare's adjustments.
• Gearing: a target total gearing ratio below 70 per cent.
• Debtors: trade debtors over 30 days are excluded from ANTA unless you can show they have been paid.

Reviews don't stop once you're approved

Major Builders go through an annual Programmed Eligibility Review based on their annual financial statements. ASR eligibility is reviewed automatically before it expires. icare can also run a special review at any time — for example after trading losses, a worsening ANTA position or adverse credit alerts — and may then ask for security, reduce limits, load the premium, or suspend eligibility.