November 24, 2025 • 9 mins
CEO of Masters Builders Ankit Sharma talks to Nick Mills about the new building consumer protections announced by the government yesterday.
They talk about the impact on master builders, consumers, and the future of construction in NZ.
LISTEN ABOVE
See omnystudio.com/listener for privacy information.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:07):
You're listening to the Wellington Mornings podcast with Nick Mills
from News Talks.
Speaker 2 (00:11):
A'd b. An Kit Sharma is the CEO of Master Builders,
and he joins us now on the show. Good Morning,
an Kit, Good morning Nick. How are builders feeling about
this decision?
Speaker 1 (00:25):
Builders?
Speaker 3 (00:26):
Well, master builders are feeling good about this because a
lot of builders already take insurance when they are building houses,
and I think this is a step in the right direction,
So builders will feel good about it. It will lift
standards in the industry, and if it's done right, it
will also improve protections for consumers.
Speaker 2 (00:45):
Why are builders not included?
Speaker 3 (00:49):
What do you mean by that?
Speaker 2 (00:50):
Well, they're not included in the program. It's engineers and architects.
Builders aren't included, are they?
Speaker 3 (00:56):
So builders are included in form of that they have
to get a home warranty, which is effectively warranting the
builders work. Yes, there's a feedback which is a point
I think are raising. Is should builder at a professional
indemnity insurance? Yes, it's harder to get PI insurance for
builders just the nature of what they do. They're actually
not providing advice or services, they're actually building stuff. But
(01:22):
I think it's probably an area we would like that
they are more insurance offering that product, which will then
make it even more resilient moving forward. But pr is
not a very common thing available for builders, so the
government has gone with the optional. Builders needs to have
home warranty insurance.
Speaker 2 (01:38):
How do homeowners know whether it's a building defect or
a workmanship issue or you know, they'll know when it's incomplete,
but how do they know?
Speaker 3 (01:48):
Well, that's a very good point. So it's any change
like this, it's such a complex feel and such a
technical field that if you don't provide very clear consumer education.
You know what is a warranty, what's covered in warranty,
what's the defect? You know what are your rights and
what are things you need to do as in to
MEETI your obligations within that. So I think we will
(02:09):
need to do a lot more work as an industry
with the government as the change comes in to provide
this level of education to homeowners so they know what
they need to do and they understand what their protection
fits available to them.
Speaker 2 (02:23):
Do you think this is a plan by the government
to I don't want to use the terminology depowered councils,
but take a lot of the control away from the
city councils.
Speaker 3 (02:33):
Well, I think it's probably less of the control. It's
making sure when you have a system that's a fair system.
So currently you know, if something goes wrong with a
particular house and you go to build, their architects go
under which happens quite a lot for builders and a
building companies get under pressure, they will liquidate and the
joint and slevel system would mean the council will then
(02:53):
have to come in and fit the bill of fixing
the entire thing, and council may have a very small
part they may have played in what has gone wrong.
So what that does that makes a very unfair system
where there's a lot of burden on the council effectively
on the right pairs. So you actually want a system
which is fairer that you know, the risk you bring
to the table is your risk you have to cover. Four.
(03:16):
What the current system does is provide a really good
protection to consumers. The consumers know if something happens, the
builders not there, there's a leaky home, you can go
after the council. So when you move to our personate
system where council only has the share of the risks
or the contribution of the era. Their course, then you
need to build a lot of consumer protection mechanisms to
(03:37):
make sure when you move to a more fairer system
that it's actually not leaving the consumers bearing higher risk
than they do today.
Speaker 2 (03:45):
Well, and kit, how does that help somebody that you've
given a great example of a leaky home that say,
that's a modern day leaky home, and the builders works
a couple of hundred thousand dollars. The architects twenty five
or thirty or fifty. The engineer is another twenty or
fifty who pays the builders one for the reset or
the fixing of it. If the builder decides that he
(04:06):
just wants to liquidate and start a new company.
Speaker 3 (04:09):
So it's a great question. So today builder liquid eight,
the council will have to step in and adjoin the
Sevil system and pay the cost of fixing that issue.
What the government is proposing is in the new system,
the builder's share will be covered by the warranty. So
that's why they're saying there's a mandatory home warranty which
the builder will have to take. And the warranty will
(04:31):
have some caps, so you know, if a one day
is a cap of two hundred thousand, then the homeowners
are protected up to two hundred thousands. The builder goes
under the insurance will pay out up to two hundred
thousand or whatever the cap of that insurance product is
for the homeowner to go to another builder to get
that issue resolved.
Speaker 2 (04:47):
Have you had examples, and I'm sure you have, of
where this particular situation has happened where a builders halfway
through a job or had some deficts and a job
that he's completed or she's completed and liquidated and disappeared,
and insurance companies are left holding the bill I actually work.
(05:07):
Does it work?
Speaker 1 (05:09):
Well?
Speaker 3 (05:10):
This is if you ask me what makes me the
most fastating out of my job, that issue makes me
the most fastatics. I'll give you an example. There was
a build there who who was a master build there,
had one lot of record, one lot of awards, and
got into financial trouble and liquid at it and left
five or six homes which were not completed. And the
(05:32):
homes because when builders get into financial trouble, they don't
then manage their subcontractors and the work they had done
was actually not to the standard it needed to be.
So luckily for those homeowners they had a master build insurance,
so we had to step in as an insurer to
pay money to get all those issues fixed and they
get house completed. So if you have the right insurance,
(05:55):
insurance will step in and will pay out. But what
the government is proposing doesn't fix that issue. So what
government is actually proposing at the moment is if your
house is complete and it got a quart of com science,
and then you find there's an issue, then there's a
home warranty which will step in to fix the issue,
and then if the builder then goes under, somebody else
(06:15):
will fix that. But if your home is in the
process of getting built and the builder goes under, then
you don't get a protection five or four with what
government is proposing. But they are products in the market
which homeowners can take which gives them a completion cover
to say, look, if I'm using a builder, if the
builder goes under, the insurer will then step in. So
they are insurers who do that. We do that, and
(06:38):
what we are doing is trying to create this education
to consumers when you're actually picking a builder. As much
as it's extremely important to pick a builder who's got
good track record, you's got good references do good work.
You also have to look at their financial strength and
make sure they're running a good business so they will
actually be there and get your house completed.
Speaker 2 (06:57):
Let's be fair. And that's pretty difficult like information to
obtain for a guy sor a family that just wants
a bathroom in a kitchen and a another bedroom put on,
isn't it.
Speaker 3 (07:08):
I know exactly. I mean I did a renovation before
I started a master builders and pet when I was
paying a big deposit. That's when I freaked out thinking
we should have done more duligens on the builder, and
it was too late. So you're right, it's hard for
us to do the due diligence. We don't even know
we need to do the due diligence. New Zealand is
a very trusting society. We trust people to do the
(07:29):
right thing. So that's probably an area we need to
do more education. As an industry. We need to take
more responsibility and do more education and provide easy tools
for homeowners to have access to that information. And I
think the government can hopefully do more in this space
as well.
Speaker 2 (07:44):
How secure and this is a great question for you.
I think It's a great question because I'm asking, as
somebody is about to do some rehninos, how secure should
we feel by employing a builder that's got that's your
sticker of master Builders on the side of this truck.
Speaker 3 (08:00):
Well, you should feel very secure because we do a
lot of financial checks. We don't only look at that
the builder is a good builder before they become a
master builder. We do a lot of financial checks before
they become a master builder, and we also continue to
do financial checks, so we are every month we run
a report where we're looking at how those builders are
paying their bills. So there's a credit report which comes
(08:21):
out and that gives us a sense on if they're
running their business well or not. And then you know,
homeowners can choose to take a Master Build guarantee if
they're using a Master builder, so that provides them another
layer of protection. And it's not just master builders. There
are other associations and other insurance products which are out
there which are providing something very similar. So there as
(08:42):
an industry, we're trying to do that. We're trying to
provide better information, have high quality builders as a part
of our setup, just to lift the standard up.
Speaker 2 (08:53):
Thank you. Very much an kit for talking to us
that's anchored Shama, CEO of Master Builders.
Speaker 1 (08:59):
For more from Wellington Mornings with Nick Mills, listen live
to news talks It'd be Wellington from nine am weekdays,
or follow the podcast on iHeartRadio
You're listening to the Wellington Mornings podcast with Nick Mills
from News Talks.
Speaker 2 (00:11):
A'd b. An Kit Sharma is the CEO of Master Builders,
and he joins us now on the show. Good Morning,
an Kit, Good morning Nick. How are builders feeling about
this decision?
Speaker 1 (00:25):
Builders?
Speaker 3 (00:26):
Well, master builders are feeling good about this because a
lot of builders already take insurance when they are building houses,
and I think this is a step in the right direction,
So builders will feel good about it. It will lift
standards in the industry, and if it's done right, it
will also improve protections for consumers.
Speaker 2 (00:45):
Why are builders not included?
Speaker 3 (00:49):
What do you mean by that?
Speaker 2 (00:50):
Well, they're not included in the program. It's engineers and architects.
Builders aren't included, are they?
Speaker 3 (00:56):
So builders are included in form of that they have
to get a home warranty, which is effectively warranting the
builders work. Yes, there's a feedback which is a point
I think are raising. Is should builder at a professional
indemnity insurance? Yes, it's harder to get PI insurance for
builders just the nature of what they do. They're actually
not providing advice or services, they're actually building stuff. But
(01:22):
I think it's probably an area we would like that
they are more insurance offering that product, which will then
make it even more resilient moving forward. But pr is
not a very common thing available for builders, so the
government has gone with the optional. Builders needs to have
home warranty insurance.
Speaker 2 (01:38):
How do homeowners know whether it's a building defect or
a workmanship issue or you know, they'll know when it's incomplete,
but how do they know?
Speaker 3 (01:48):
Well, that's a very good point. So it's any change
like this, it's such a complex feel and such a
technical field that if you don't provide very clear consumer education.
You know what is a warranty, what's covered in warranty,
what's the defect? You know what are your rights and
what are things you need to do as in to
MEETI your obligations within that. So I think we will
(02:09):
need to do a lot more work as an industry
with the government as the change comes in to provide
this level of education to homeowners so they know what
they need to do and they understand what their protection
fits available to them.
Speaker 2 (02:23):
Do you think this is a plan by the government
to I don't want to use the terminology depowered councils,
but take a lot of the control away from the
city councils.
Speaker 3 (02:33):
Well, I think it's probably less of the control. It's
making sure when you have a system that's a fair system.
So currently you know, if something goes wrong with a
particular house and you go to build, their architects go
under which happens quite a lot for builders and a
building companies get under pressure, they will liquidate and the
joint and slevel system would mean the council will then
(02:53):
have to come in and fit the bill of fixing
the entire thing, and council may have a very small
part they may have played in what has gone wrong.
So what that does that makes a very unfair system
where there's a lot of burden on the council effectively
on the right pairs. So you actually want a system
which is fairer that you know, the risk you bring
to the table is your risk you have to cover. Four.
(03:16):
What the current system does is provide a really good
protection to consumers. The consumers know if something happens, the
builders not there, there's a leaky home, you can go
after the council. So when you move to our personate
system where council only has the share of the risks
or the contribution of the era. Their course, then you
need to build a lot of consumer protection mechanisms to
(03:37):
make sure when you move to a more fairer system
that it's actually not leaving the consumers bearing higher risk
than they do today.
Speaker 2 (03:45):
Well, and kit, how does that help somebody that you've
given a great example of a leaky home that say,
that's a modern day leaky home, and the builders works
a couple of hundred thousand dollars. The architects twenty five
or thirty or fifty. The engineer is another twenty or
fifty who pays the builders one for the reset or
the fixing of it. If the builder decides that he
(04:06):
just wants to liquidate and start a new company.
Speaker 3 (04:09):
So it's a great question. So today builder liquid eight,
the council will have to step in and adjoin the
Sevil system and pay the cost of fixing that issue.
What the government is proposing is in the new system,
the builder's share will be covered by the warranty. So
that's why they're saying there's a mandatory home warranty which
the builder will have to take. And the warranty will
(04:31):
have some caps, so you know, if a one day
is a cap of two hundred thousand, then the homeowners
are protected up to two hundred thousands. The builder goes
under the insurance will pay out up to two hundred
thousand or whatever the cap of that insurance product is
for the homeowner to go to another builder to get
that issue resolved.
Speaker 2 (04:47):
Have you had examples, and I'm sure you have, of
where this particular situation has happened where a builders halfway
through a job or had some deficts and a job
that he's completed or she's completed and liquidated and disappeared,
and insurance companies are left holding the bill I actually work.
(05:07):
Does it work?
Speaker 1 (05:09):
Well?
Speaker 3 (05:10):
This is if you ask me what makes me the
most fastating out of my job, that issue makes me
the most fastatics. I'll give you an example. There was
a build there who who was a master build there,
had one lot of record, one lot of awards, and
got into financial trouble and liquid at it and left
five or six homes which were not completed. And the
(05:32):
homes because when builders get into financial trouble, they don't
then manage their subcontractors and the work they had done
was actually not to the standard it needed to be.
So luckily for those homeowners they had a master build insurance,
so we had to step in as an insurer to
pay money to get all those issues fixed and they
get house completed. So if you have the right insurance,
(05:55):
insurance will step in and will pay out. But what
the government is proposing doesn't fix that issue. So what
government is actually proposing at the moment is if your
house is complete and it got a quart of com science,
and then you find there's an issue, then there's a
home warranty which will step in to fix the issue,
and then if the builder then goes under, somebody else
(06:15):
will fix that. But if your home is in the
process of getting built and the builder goes under, then
you don't get a protection five or four with what
government is proposing. But they are products in the market
which homeowners can take which gives them a completion cover
to say, look, if I'm using a builder, if the
builder goes under, the insurer will then step in. So
they are insurers who do that. We do that, and
(06:38):
what we are doing is trying to create this education
to consumers when you're actually picking a builder. As much
as it's extremely important to pick a builder who's got
good track record, you's got good references do good work.
You also have to look at their financial strength and
make sure they're running a good business so they will
actually be there and get your house completed.
Speaker 2 (06:57):
Let's be fair. And that's pretty difficult like information to
obtain for a guy sor a family that just wants
a bathroom in a kitchen and a another bedroom put on,
isn't it.
Speaker 3 (07:08):
I know exactly. I mean I did a renovation before
I started a master builders and pet when I was
paying a big deposit. That's when I freaked out thinking
we should have done more duligens on the builder, and
it was too late. So you're right, it's hard for
us to do the due diligence. We don't even know
we need to do the due diligence. New Zealand is
a very trusting society. We trust people to do the
(07:29):
right thing. So that's probably an area we need to
do more education. As an industry. We need to take
more responsibility and do more education and provide easy tools
for homeowners to have access to that information. And I
think the government can hopefully do more in this space
as well.
Speaker 2 (07:44):
How secure and this is a great question for you.
I think It's a great question because I'm asking, as
somebody is about to do some rehninos, how secure should
we feel by employing a builder that's got that's your
sticker of master Builders on the side of this truck.
Speaker 3 (08:00):
Well, you should feel very secure because we do a
lot of financial checks. We don't only look at that
the builder is a good builder before they become a
master builder. We do a lot of financial checks before
they become a master builder, and we also continue to
do financial checks, so we are every month we run
a report where we're looking at how those builders are
paying their bills. So there's a credit report which comes
(08:21):
out and that gives us a sense on if they're
running their business well or not. And then you know,
homeowners can choose to take a Master Build guarantee if
they're using a Master builder, so that provides them another
layer of protection. And it's not just master builders. There
are other associations and other insurance products which are out
there which are providing something very similar. So there as
(08:42):
an industry, we're trying to do that. We're trying to
provide better information, have high quality builders as a part
of our setup, just to lift the standard up.
Speaker 2 (08:53):
Thank you. Very much an kit for talking to us
that's anchored Shama, CEO of Master Builders.
Speaker 1 (08:59):
For more from Wellington Mornings with Nick Mills, listen live
to news talks It'd be Wellington from nine am weekdays,
or follow the podcast on iHeartRadio
Popular Podcasts
Las Culturistas with Matt Rogers and Bowen Yang
Ding dong! Join your culture consultants, Matt Rogers and Bowen Yang, on an unforgettable journey into the beating heart of CULTURE. Alongside sizzling special guests, they GET INTO the hottest pop-culture moments of the day and the formative cultural experiences that turned them into Culturistas. Produced by the Big Money Players Network and iHeartRadio.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.