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Protection for shoddy renovations

WIN-WIN: The new measures of insurance and a standard contract will help both home owners and contractors to resolve renovation disputes.


    Aug 12, 2014

    Protection for shoddy renovations

    HOME owners planning to refurbish their abodes can look forward to better protection from botched or incomplete renovation jobs next year.

    They will get insurance which compensates them should the contractor fail to finish the job, and contracts that spell out all the fees the contractors are charging.

    These changes are part of a new drive aimed at raising standards in the renovation industry, said Consumer Association of Singapore (Case) president Lim Biow Chuan.

    Last year, there were 1,779 complaints, up from 1,532 in 2012 and 1,488 the year before. Most of the complaints centred on unsatisfactory services and failure to honour contractual agreements.

    Between January and July this year, there were 813 complaints.

    To raise the standards of the industry, Case and the Singapore Renovation Contractors and Material Suppliers Association (RCMA) inked a new deal which will implement a new accreditation scheme for renovation firms.

    "It's an unregulated industry," said Mr Lim.

    "Ultimately, this scheme is meant to raise the standards of the renovation industry, as well as to provide greater assurance to consumers that in the event of a dispute, there are proper ways to resolve it."

    There are more than 1,800 renovation contractors registered with the Housing Board.

    Currently, there is a renovation accreditation scheme under CaseTrust, the consumer watchdog's accreditation arm.

    The scheme, which has 22 accredited contractors, promises workmanship assessment and compulsory mediation by Case in the event of a dispute.

    But under the new scheme, accredited contractors, who have to be RCMA members, are required to purchase a performance insurance bond for their customers. This will allow customers to claim from insurance companies if the job is unfinished.

    "The amount claimable depends on the case. But, in general, it will help to compensate for what's not completed," said Case executive director Seah Seng Choon.

    Another feature of the scheme is a standard contract specifying fees and fee-refund policies, which customers and contractors both have to sign. Contractors who breach this will be stripped of their accreditation.

    RCMA vice-president Sky Tan said the scheme will also benefit participating contractors who have to deal with unreasonable customers: "We need to protect consumers but also be fair to contractors. This will create a fair platform to resolve disputes."

    So far, 15 RCMA members have signed on to the new scheme. But Dr Tan hopes that all of its 122 members will participate.

    One of them, Kelvin Lim, 47, managing director of Vegas Interior Design, said that although mandatory performance might raise costs, it was good for both consumers and contractors.

    "A lot of them don't know renovation practices well and this leads to a lot of complaints and disputes," he said.

    Civil servant Lai Han-Wei, 30, who renovated his four-room Punggol flat last year, said he would opt for an accredited contractor, even if it means paying more.

    "My wife and I were over-quoted for carpentry and tiling, and there were hidden costs that were conveyed verbally. The contract and insurance would have given us peace of mind," he said.