Builders in Victoria have to buy domestic building insurance policies on homeowners' behalf before they take deposits or any money for projects of more than $16,000.
The requirement falls under the Domestic Building Insurance Ministerial Order.
"The law requires builders to take out a domestic building insurance policy on behalf of a client before taking a deposit," a government spokesman said.
"Customers rightly expect their construction firms to obey the law - and we're now looking into concerning allegations relating to Porter Davis's conduct."
Grant Thornton on Tuesday held a webinar for Porter Davis customers following the company's collapse.
Liquidator Said Jahani suggested some were without insurance, saying they fell into a gap between paying Porter Davis a deposit and not having an insurance policy until weeks or months later when a permit was obtained.
"At its extreme, it means you do not have any insurance cover and it means that the deposit you have paid has been lost," Mr Jahani said.
Porter Davis customers who are unsure if they have domestic building insurance should contact the Victorian Managed Insurance Authority, which is dealing with claims in the state.
Other firms also offer domestic building insurance.
The Queensland Building and Construction Commission is dealing with claims from the Porter Davis fallout in Queensland, with about 1500 properties in Victoria and 200 in Queensland estimated to be affected by the company's demise.
Those without a certificate of insurance should contact liquidators Grant Thornton.
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