| Licensing and Warranty
Overview
The Homeowner
Protection Act (Act) provides for the licensing of residential builders
and makes third-party warranties mandatory on new home construction throughout the
province.
The licensing and warranty systems work together to
ensure that builders meet minimum standards and consumers are protected with a strong,
third-party warranty should a construction defect occur.
For builders, licensing promotes a level playing field
by establishing minimum standards required to enter and continue operating as a
residential builder. The minimum standards will, in effect, become a barrier to those who
might otherwise blemish the overall reputation of the industry and undermine public
confidence.
Residential
Builder Licensing
As of July 1, 1999, all residential builders applying
for a building permit are required to be licensed by the HPO.
Public
Registry of Licensed Residential Builders
A listing of all licensed residential builders is
maintained by the HPO and is available to the public. The Registry is available online and
is linked directly to the licensing database. The Registry is also available by calling
the HPO at 1-800-407-7757.
For more detailed information on residential builder
licensing see:
Home
Warranty Insurance
As of July 1, 1999, residential builders applying for
building permits to construct new homes are required to provide third-party warranty
insurance. Home warranty insurance can now only be provided by insurance companies
that are authorized by the Financial Institutions Commission and meet the requirements set
out in the Homeowner Protection Act. Strong underwriting practices and required
technical reviews of projects prior to construction will help bring about an improvement
in the quality of residential construction.
Exemptions
Owner-built homes,
purpose-built rental housing (multi-unit, single title, built for rental purposes),
factory built homes, hotels, motels, dormitories, care facilities and float homes are all
exempt from the warranty requirements.
Building Envelope Renovations
After September 30, 2000 repair
contractors will have to be licensed by the Homeowner Protection Office and provide
mandatory, third-party warranty in order to get a building permit for applicable building
envelope repairs.
Repair contractor licensing and
mandatory third-party warranties will help ensure that repairs are: effective,
long-term solutions, performed by qualified contractors and backed by third-party warranty
insurance.
Enforcing the
New System
As the new licensing and mandatory warranty system was
introduced full time Compliance Officers were added to the existing HPO enforcement team
to protect consumers and ensure adherence to the Homeowner Protection Act and
regulations.
Abuse of the owner -builder exemption affects both
homeowners and industry because purchasers of owner-built homes do not have the benefit of
home warranty insurance, unfair competition is created between non-licenses builders and
licensed builders who pay the necessary licensing fees and warranty fees which pools for
warranty providers are smaller than they would be which will eventually result in higher
premiums for home warranty insurance.
Further steps are being taken, such as increased
enforcement and HPO distribution of owner-builder exemption forms, to modify the existing
system to ensure increased consumer protection and create a more level playing field for
the residential construction industry.
Other
Resources:
- Technical Bulletins will be
issued to licensed residential builders on a periodic and as needed basis in order to
clarify items of a technical nature that might relate to building code interpretation, new
technology, best practices and other similar matters.
- Building
BC is a
periodic newsletter for licensed residential builders, Building Officials and the
industry.
Last Updated: November 17, 2003 |
