Understanding Strata Insurance in Australia
Don’t risk the chance of getting caught without the right strata insurance for your apartment block or Duplex. There are different kinds of policies that are required for shared housing complexes or neighborhoods, and as an experienced commercial insurance broker, we can make sure you and any housing complex that you help manage are properly covered.
Of course, we also help our clients find competitive prices and insurers with good records of customer service and handling claims. At Hamilton Brokers, we are the leading commercial insurance brokers in Canberra. To learn more about our services you can visit our website here:
Understanding a Strata Title
A strata title is related to owning multi-level apartment complexes and horizontal neighborhoods. The name “strata” comes from the original meaning of the term applied to apartments that might be on different levels, or the strata, of a building. It was specifically designed to assist residents who have ownership of their own home, but then also have joint ownership of common areas. There had to be a way for all of the owners within the building to share the risks of this ownership and also share the expense of covering certain risks.
The term “strata” is a particularly Australian system of dividing ownership up for housing units, and it originated in this country in the early part of the 1960s. However, since then the term has spread and is now used in many other countries such as Canada, Singapore, and South Africa. However, we are only Australian commercial insurance brokers.
The Basics of Strata Insurance
In some states, this particular type of insurance is also called body corporate cover which is insurance coverage that helps protect the common areas and building of housing property. It is most closely associated with large buildings that contain many individual residential units, but the term is also used for regular neighborhoods that have residents who share common walls or areas like club houses and pools.
The owners of the strata titles will usually share the premium of this kind of policy the way that they share these common parts of a housing development. Typically, the cost is evenly prorated to all residents. However, in some cases the management may prorate depending on the size or value of the individual residence. In any case, the premium cost will come out of normal strata fees. In each Australian state this kind of insurance is mandatory.
Is Strata Insurance More Expensive In Some Regions?
In some parts of the country, insurers have studied the history of claims and have found that some areas have greater risks when insuring property. For example, parts of Australia that are prone to cyclones face a larger risk than those that don’t. As a result, the area where there is a risk of natural hazards will have higher insurance costs than those places where insurers believe that the risk is fairly small.
Also, the premium for any one apartment block or other kind of housing development might depend upon the value, risk, and type of shared property and the amount of claims the property has experienced. For example, it might cost a lot less to share a street-level parking lot than it is to cover a complex with a swimming pool or gymnasium.
What Kinds Of Risks Does Strata Insurance Cover?
Strata insurance covers the all physical assets of a apartment or unit complex for property owners. This might include an underground or street-level parking garage, swimming pool, park, or playground. It also typically covers the external structure of a shared building like the outer walls, roof, ceilings, electrical wiring, and floors.
There is also a shared liability policy provided in this type of cover so for example if a child is injured in the playground of a housing complex and parents file a claim because a piece of equipment was not well maintained, the policy might pay the claim. In some cases, it can also provide a legal defense if a liability claim goes to court.
What Doesn’t Strata Insurance Cover?
All insurance policies have some exclusions, and these policies are no different. The exact nature of what is and isn’t covered could be different with each policy and each insurer. It is very important to understand all of the details of each policy. For example, flood or land movement might be specifically excluded.
Also, it is really important to understand exactly what this kind of insurance is intended to cover and what it was never attended for. Mostly, it is intended as insurance for Strata Plan. That means that it was never intended to be a personal insurance policy. Residential property owners need to have their own policies as well.
What Other Insurance Do Property Owners Need?
Every property owner needs to ensure their own property is covered. This cover might include furnishings, like furniture, curtains and carpets. It might also include your personal property such as clothes, jewelry, computers, kitchen appliances and books.
Owners who buy residential units to rent out and do not live on the property may have different coverage needs as landlords. It is always very important to speak with a good insurance broker to determine the right kind of coverage for your individual needs. While a Landlord might not need to cover personal property, he or she still may need liability insurance for a rental property.
Finding out More about Strata Insurance
At Hamilton Insurance Brokers we are experienced commercial insurance brokers based in Canberra. We know that each of our clients has slightly different needs, and we take the time to learn about each client to ensure we fully cater for their requirements. If you believe your current strata cover is too expensive, your insurer is slow to pay claims, or you just need help understanding a policy, contact us for help.
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This information may be regarded as general advice. That is, your personal objectives, needs or financial situations were not taken into account when preparing this information. Accordingly, you should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs before acting on it.