Proportionate Liability Is A Smarter Path To Protecting Homeowners

The Government’s proportionate liability proposal should be seen as part of a broader framework that, when coupled with insurance and higher construction standards, will deliver stronger long-term protection.

So says the New Zealand Institute of Building Surveyors (NZIBS), following concerns from industry voices who fear the proposal will weaken consumer safeguards.

Ultimately, NZIBS President Darryl August agrees with Duncan Colebrook, and if the Government doesn’t get the finer details right, the industry could be staring down the barrel of another sector-wide disaster.

However, August stresses that proportionate liability offers a practical safeguard for homeowners, so long as it is supported by accessible insurance.

“Insurance is vital to making proportionate liability work effectively. But it’s not the whole puzzle,” says August.

“We need a building industry that consistently delivers higher-quality homes with fewer defects. That only comes through better education, higher professional standards, and a commitment to doing things right the first time.”

August likens the proportionate liability scheme and higher industry standards to car ownership.

“You wouldn’t drive off the lot without car insurance, or in a car that didn’t come with some form of warranty or guarantee. All of which are vital safety nets. But insurance doesn’t replace the need to drive carefully and responsibly.

“The same applies here: proportionate liability and insurance provide important protection, but the real goal is to reduce defects in the first place through better building practices.”

August believes the current conversation has been too narrowly focused on liability settings.

Long-term homeowner protection depends equally on two safeguards: robust insurance cover and a better-educated, more capable building industry.

“We can’t insure our way out of poor quality. If we build homes right from the start, we reduce claims, reduce disputes, and strengthen confidence in the entire system.”

© Scoop Media