Satisfying the financial and insurance requirements for an electrical contractor licence

Standard to satisfy the chief executive

A DEIR 'Certificate of Currency' or another form of documented evidence from an insurer authorised under the Insurance Act 1973 to carry on insurance business, i.e. an Australian Prudential Regulatory Authority (APRA) authorised insurer/s or Lloyd's underwriters, confirming a policy with broad form public and products liability with a limit of indemnity of $5,000,000 (minimum). The evidence may be signed by the insurer or an authorised representative (for example an agent or broker for the insurer).

The alternative form of documented evidence MUST:

• include all the insurance details covered by the DEIR Certificate of Currency; and
• detail a policy including cover for goods in care, custody or control arising from:
  • liability arising from testing and certification of work;
  • resultant injury, loss or damage arising from faulty design work performed by the
    policy holder, where they did not charge a specific fee for the design work;
  • resultant injury, loss or damage arising from incorrect advice given by the policy
    holder; and
  • include consumer protection liability for $50,000; and

(these details could equally be declared if the alternative form of documented evidence that states the insurance meets the requirements of a contract of insurance approved by the chief executive under section 43(2) of the Electrical Safety Regulation 2002 i.e. the above).

• note that insurance is provided for the purposes of meeting the insurance requirements for an electrical contractor licence under the Electrical Safety Regulation 2002; and
• verify the insurer's identity by for example letterhead or company stamp.

It is acceptable for two licensed APRA authorised insurers to combine to provide the complete package of insurance, with one insurer providing the consumer protection liability component and the other the rest. Each component must be evidenced by either the certificate of currency or another form of documented evidence.

State and local governments, statutory authorities and government owned corporations may provide another form of evidence that shows the same level of protection as the above certificate of currency.

For local governments, a statement signed by the Chief Executive Officer that the council has an equivalent level of protection by way, for example, of self insurance is a satisfactory form of evidence.

The statement may refer to an equivalent level of protection for only one insurance requirement of the DEIR Certificate of Currency as long as the remaining insurance requirements are confirmed by a Certificate of Currency.

Acceptable 'name of insured' - Nominates legal name as per the application

Nominates a "legal name t/a business name". For example, if the company's legal name is ABC Pty Ltd and their business name is Sparkies, the name of insured can be "ABC Pty Ltd trading as Sparkies"

Nominates a legal name but no business name where a business name exists on the application form, e.g. ABC Pty Ltd t/a Sparkies, but only ABC Pty Ltd is shown on the certificate of currency and no business name is nominated.

Nominates the legal name of the licence holder and another entity who is not a licence holder. This would be most commonly found when a company director includes themself on the company's insurance. e.g. Brown Pty Ltd and Phil Brown (their director number may be included)

When a licence is issued to a trustee the name of insured can be shortened to the individual, partnership or corporation. For example if the trustee's full legal name is "Thomson Pty Ltd as trustee for the Thomson Family Trust", the name of insured can be Thomson Pty Ltd.

Not acceptable 'name of insured' - Nominates a business name only

Nominates the legal name incorrectly to the extent that it appears to be a different legal entity to the licence applicant. For example the legal name of the licence applicant is Greenfield Pty Ltd; the name of the insured is John Greenfield.

Nominates the legal name of more than one licence holder. Whilst the licence holders may approach an insurer to provide a single policy of insurance, their insurance must be evidenced separately.

Standard to satisfy the chief executive

Complete declaration of financial requirements as per application form.

Declarations are subject to audit. Appropriate evidence of net realisable assets or assets available for disposal includes:

• Bank statement issued by an authorised deposit taking institution (ADI) under the Banking Act 1959 showing a $5,000 or $10,000 balance
• Credit card or overdraft statement issued by an ADI showing $5,000 or $10,000 available credit
• Mortgage statement issued by an ADI showing $5,000 or $10,000 available for redraw