Changes to professional obligations under the Design and Building Practitioners Act 2020 (the Act).

Professional indemnity insurance requirement deferred 
The Act requires registered building practitioners to hold professional indemnity insurance for the work they carry out. This mandatory insurance requirement will now commence from 1 July 2025. The 12-month extension recognises that building practitioners currently have limited access to insurance products to adequately cover their work. 

NSW consumers will continue to be protected by statutory warranties covering defective or incomplete work under the Home Building Compensation Scheme and the Home Building Act 1989.

More time to comply with remedial work requirements (Class 3 and 9c only) 
The design and building industry will now have until 1 July 2025 to comply with the Act for altering, repairing or renovating existing Class 3 and 9c buildings (such as boarding houses and residential care buildings).

The Act continues to apply to building work on new and existing Class 2 buildings, such as multi-storey, multi-unit apartment buildings, and new Class 3 and 9c buildings.

New exemption for work on hotels and motels 
Registered design and building practitioners are not required for certain Class 3 and 9 buildings, such as hotels and motels.

From 1 July 2024, the following types of new low-risk Class 3 buildings and Class 9 buildings containing a minor Class 3 part will be exempt from requirements under the Act:

1. hotels and motels (if no part is subject to a residential strata scheme or contains serviced apartments)  
2. Class 9a or 9b buildings that include minor accommodation facilities where the Class 3 part is less than 10 per cent of the gross floor area.

This means:

1. registered design practitioners will not be required to prepare designs and design compliance declarations for these buildings
2. a registered building practitioner will not be required to lodge declarations and work on these buildings.

If building work started on a new hotel, motel or minor accommodation facility before 1 July 2024:

1. these developments will be excluded from the rules and obligations under the Act
2. any further designs and design compliance declarations do not need to be uploaded on the NSW Planning Portal 
3. a building compliance declaration does not need to be submitted. 

For more information about these changes, visit Building Commission NSW.