Strata Insurance: What Does It Cover and What Are Your Responsibilities?

 Strata insurance is a vital aspect of strata living, ensuring that the building and common property are protected from unforeseen events. Whether you're an owner or part of the owners corporation, understanding the coverage and your responsibilities is essential for maintaining the value and safety of the property.

What Does Strata Insurance Cover?

Strata insurance typically covers the common property of the building, which includes areas such as:

  • Roof, external walls, and windows
  • Lobbies, stairwells, and hallways
  • Shared facilities like pools, gyms, and lifts
  • Gardens and external structures such as fences and car parks

Key areas covered by strata insurance include:

  1. Building Damage: This covers damage from incidents like fire, flood, storms, and vandalism.
  2. Public Liability: Protects the owners corporation if someone is injured on common property, ensuring compensation is available for medical costs and legal fees.
  3. Legal Liability: Covers legal costs and damages if the owners corporation is sued for negligence or failing to maintain common property.
  4. Loss of Rent: If a unit becomes uninhabitable due to an insured event, strata insurance may cover the loss of rental income for the owner.
  5. Voluntary Workers Cover: This provides protection for individuals who volunteer to work on common property, covering them in case of injury.

What Are Your Responsibilities?

As a lot owner in a strata scheme, you also have responsibilities regarding strata insurance:

  1. Contribute to Insurance Premiums: Strata insurance is arranged by the owners corporation, and all owners are required to contribute to the premiums through their strata levies.

  2. Understand Coverage Limits: Strata insurance usually covers the building and common areas, but you are responsible for insuring the contents inside your individual lot. This includes things like carpets, curtains, and personal belongings.

  3. Maintain Your Lot: While the owners corporation is responsible for common property, owners must ensure that their individual lot is well-maintained. Negligence in maintaining your unit could lead to issues that may not be covered by strata insurance.

  4. Notify the Owners Corporation: If you become aware of any damage or risks to common property, it's important to notify the owners corporation so that repairs can be made, reducing the chance of disputes or uncovered losses.

  5. Comply with By-Laws: Ensure you follow the by-laws set by your strata scheme, especially when renovating or altering your unit, as unauthorised work could void strata insurance coverage.

When to Consult a Strata Lawyer

Strata insurance can sometimes be complex, especially when it comes to claims, coverage disputes, or understanding your specific obligations. Consulting a strata lawyer can help clarify your rights, responsibilities, and any potential legal issues regarding insurance within your strata scheme.

A strata lawyer can assist with:

  • Reviewing insurance policies to ensure proper coverage
  • Advising on claims disputes with insurers or the owners corporation
  • Guiding owners through legal responsibilities related to maintenance and repairs

For peace of mind, getting professional advice from a strata lawyer can help protect your investment and ensure your rights are safeguarded.

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