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New Home Improvement Guarantee Scheme 'offers installers peace of mind'
Published:  24 June, 2015

The Home Improvement Guarantee (HIG) scheme is seeking to expand its network of approved tradespeople to meet rising demand.

The scheme is designed to offer protection to both homeowners and the trade. Homeowners can use the scheme to source Trading Standards-approved tradespeople who have undergone a background check and have agreed to HIG's terms and conditions. Meanwhile, customers must commit money into an independently regulated account ahead of the tradesperson commencing the work, giving installers a safety net against "cowboy customers" who commission work they cannot afford.

The HIG requires that member tradesmen undergo a background check, which costs £95, but the fee is refundable from the income paid on their first two jobs provided by the HIG network.

HIG's head office sources tradespeople from all over the country to quote for jobs ranging from kitchen/bathroom projects to entire rebuilds and renovations. Almost 300 builders have already signed up to the scheme.

Work carried out through the scheme is first split up into various stages, with a timescale or deadline agreed on for the completion of each stage, and the whole job.

Builders have access to a deposit, which is insured by the scheme and ensures that the tradesman can get on with the job with no disruption to cash flow.

The money for the first stage of work is placed into a Financial Conduct Authority (FCA) regulated holding account, and is released to the builder only when the consumer is happy with the work and agrees to release the funds.

The customer then places the money for the next stage of works in to their client account and the builder can continue with the next part of the project.

"By placing the money in an independent account the consumer knows that their money is safe, and the builder knows that the customer has enough money to pay for the work. This is about protecting builders from nightmare customers just as much as it is about protecting customers from unscrupulous tradesmen," said Harvey Ellingham, HIG founder.

Once all the stages have been completed, and the consumer is happy with the work that has been done, the final payment is released. If any extras crop up along the way, this is put on a separate worksheet which the homeowner signs and agrees to before the works are carried out, with the additional money paid into the independently held account.

If there is any disagreement about the quality of the work, HIG will mediate to resolve the disagreement and, if that is unsuccessful, an independent surveyor is called in to make a ruling that is binding on both parties. A contribution towards the surveyor's cost of £170 + VAT is paid for by the party who requests that the surveyor attends.

The scheme also offers an insurance-backed guarantee which provides additional security over and above the tradesman's own guarantee. It is valid for up to 10 years and insures the homeowner against the tradesman going bust, disappearing, or problems with the quality of the work. This does not cost the tradesperson anything.

The guarantee also covers deposits for building work to cover materials or to show commitment.

In return for membership and referrals, the builder pays a levy equivalent to 3% of the net value of the job (ie net of VAT) to HIG.

"Builders are often charged as much as 10% or 12% by other property professionals such as large building firms or even estate agents for being referred for work, so this 3% levy should be regarded as good value, especially for work where you know that the customer has the money and there is a watertight contract in place," said Mr Ellingham.

More information is available at www.higuk.co.uk.