Why WINIM has embraced Resilience LDI
Lower North Shore developer WINIM has been one of the most active in taking up the new 10-year Latent Defects Insurance offered to developers by Resilience Insurance.
Latent Defects Insurance, or LDI, the new game-changing policy that has just made it to Australia, covers an off the plan property buyer for 10 years post-completion for any costs associated with structural defects in their new apartment and the building as a whole.
Read more: What is Latent Defects Insurance and is it bringing confidence to the off the plan apartment market?
In a short space of time, WINIM has taken the policy out on two of its latest residential developments, and it now forms a strong part of its business model, WINIM's Senior Development Manager Peitra Creak says.
Creak says the team were completely sold on the insurance once they understood the intricacies of the policy and how it works for both the purchaser and the developer.
Creak underscores its value as having a "dual benefit," for both developer and purchaser.
"First and foremost, Resilience LDI is a purchaser-led policy that protects off the plan property buyers and will drive confidence in our industry," Creak says, adding that there are significant benefits to the developer that make it even more attractive.
"The last few years have been such a wild ride and we can't have predicted what has happened in terms of builder insolvencies, but we can learn lessons from it. We believe having Resilience LDI, as well as partnering with an iCIRT-rated builder, we're pre-empting and avoiding future issues in the built environment."
Creak says one of the biggest bonuses of Resilience LDI is that they get another set of eyes during the build process, something that can prove invaluable during the construction phase.
"The insurer is there to de-risk the project, and they do so by partnering with developers with a track record, strong finances, and consistently being a part of the build process. They have their teams on site before a shovel has been put in the ground, undertaking technical inspection services at frequent intervals."
The fact Resilience LDI is a first right insurance was also another value add.
"With it being a first right insurance, we can factor it into our feasibility well before we start building the project. It also means that action is taken as soon as an issue occurs during the build, rather than at the end of construction. That means for buyers they don't have to pay a penny if there's any sort of rectification order, and, if it ever came to it, they would have accommodation paid for if they couldn't occupy the building."
Creak says they think developers could fall behind if they don't have Resilience LDI.
"If there are two similar, competing projects in the same area, then the buyer is definitely going to opt for the one with LDI over the one that doesn't have the policy."
WINIM has several new developments on the way, in Lane Cove and Neutral Bay, that they intend on taking out the Resilience Latent Defect Insurance policy on.
What is Resilience LDI?
Resilience LDI is the first Latent Defects Insurance policy in Australia. The insurance provides off the plan apartment buyers with a 10-year warranty on their new apartment and the building it's situated in.
The cover is purchased by the property developer/builder (pre-construction) and is designed to protect owners against any immediate or future problems with the structural components of their new property, from leaks to cracks and everything in between.
For more information about Resilience LDI, click here.
