STRATA INSURANCE
If you happen to own an apartment or unit that shares common areas with other owners, then you own a strata-titled dwelling. This name is derived from the layers of living spaces that are stacked on top of each other, similar to rock strata. Although the concept of strata insurance is more than 50 years old Australia, it is a prevalent concept worldwide. In Australia, it is commonly referred to as body corporate insurance.
If I Own a Strata-titled Property, Must I Purchase Strata Insurance?
Yes, strata insurance is compulsory in all Australian states and territories. Owners of strata units do not have the option to refuse the insurance cover.
Who Pays the Insurance Premiums for Strata Insurance?
The premiums for strata cover on a building are divided amongst the owners of individual units. Generally, most premiums for strata cover cost less than the premiums collected on insurance cover for a stand-alone dwelling. According to a report from the Insurance Council of Australia, strata insurance premiums are approximately one-third of the cost of the insurance cover for an equilivant free-standing dwelling.
Can Strata Insurance Benefit Me?
Most individuals who live in strata-titled dwellings find that sharing the cost of the premiums as well as the liability for issues with others is a benefit. You also have the peace of mind knowing the correct insurance cover is in place should an unforeseen event take place.
What Will a Strata Insurance Policy Cover?
Strata insurance will cover public liability and pay claims of those injured on the property.
Although policies may vary depending on specifics of your area or dwelling, strata insurance may typically cover:
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The building
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Contents
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Shared common spaces
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Lifts
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Wiring
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Car parks
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Swimming pools
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Gardens
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Ceilings
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Floors
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Ducted air conditioning units
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Equipment, fixtures, carpeting, and furnishings located in common areas
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It is essential to consult your insurance professional to learn the details regarding what your strata policy covers.
What Are Some Customary Strata Insurance Cover Exclusions?
While your policy may contain specific exclusions that pertain only to your area, most strata insurance will not cover:
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Your personal belongings within your unit
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Asbestos and asbestos-related problems
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Erosion
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Property fencing
What Are Some Optional Add-ons Available for Strata Insurance?
It is best to speak with one of our insurance experts to find out exactly what add-ons are available. However, some typical add-ons include:
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Fidelity Guarantee – Covers losses caused by the misuse of the owner’s corporation funds
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Electrical and Mechanical Breakdowns – Pays if the breakdown in question was a result of a loss
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Office Bearer’s Liability – Protects office bearers from legal action due to another office bearer’s inappropriate actions
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Voluntary Workers’ Personal Accident Cover – Pays for losses incurred by a worker volunteering on behalf of the property owner
*Please Note* The materials presented here are for informational use only. This information is not intended to replace a consultation with an insurance professional and does not constitute legally binding advice.
Commercial Strata Insurance
Business owners need to be aware that strata insurance is compulsory across Australia. If your business is a part of commercial strata, be sure to take the necessary steps to ensure that you are appropriately covered.
What is Commercial Strata Insurance?
Commercial strata insurance provides protection for businesses operating in a divided building under a strata title, similar to residential strata insurance. This type of insurance covers the common areas of the building where your company is located.
What Are the Different Kinds of Commercial Strata Insurance?
There are a number of specific types of cover that can be a part of your commercial strata insurance. Here are three of the most common kinds. You should consult your insurance professional to discuss all of the options available to you.
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Building and Common Contents – This is the basic commercial strata cover and will guard against physical loss or damage to common contents and the physical building.
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Legal Liability – If you are found legally liable to pay because of personal injury or property damage, your commercial strata cover can help if you have legal liability as part of your policy.
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Machinery Breakdown – This typically refers to malfunction of lifts, mechanical machinery, boilers, electrical machinery, and other equipment covered under your policy
Facts About Mixed-use Strata Insurance
When a property combines residential and commercial use, it is essential to address the needs of all building occupants within a mixed strata insurance policy.
How is Mixed Strata Insurance Different From Other Kinds of Strata Cover?
Generally speaking, insurance cover for mixed strata combines the necessary elements of each individual type of insurance.
What Will a Mixed Strata Insurance Policy Cover?
A mixed-use strata policy is designed to cover common areas of a building from both residential and commercial perspectives. This type of policy is suitable for various types of properties, including residential retail, commercial retail, and mixed commercial properties. Typically, a mixed strata policy provides basic coverage for losses to the physical building and shared contents. However, there are options to customize insurance policy. It's recommended to consult with an insurance professional to determine the best choices for your specific needs.
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