Strata Title - Insurance

Insurance

Lot owners need to understand how insurance arrangements work in strata and community title schemes. These arrangements vary from jurisdiction to jurisdiction and often from building to building. The managing agent or secretary should be able to assist in this regard.

In a strata title situation, in very general terms, the body corporate is responsible for the following insurances:

  • The building and outbuildings
  • Common property public liability
  • Workers compensation
  • Voluntary workers

Lot owners are, in turn, responsible to insure the contents of their lots, as well as covering themselves against personal liability. Even the question of contents is not without its problems.

Issues arise as to whether carpets or wall coverings are part of the building or its contents. And what about the kitchen cupboards and hot water system? These are the issues a lot owner needs to address when considering the type and extent of insurance coverage they require. Some insurers offer policies that "dovetail" with each other. In other words, the items not covered under the body corporate policy are clearly covered under the contents policy. Where different companies issue the policies this "dovetailing" effect is sometimes not achieved.

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