If you’re a property owner in a strata scheme, understanding strata insurance is vital. Many owners mistakenly believe their personal insurance covers everything, only to find gaps in protection during an emergency. Strata insurance is a legal requirement in Australia and plays a critical role in protecting shared property assets.
Let’s break down what strata insurance is, what it covers, and how Beyond Strata supports owners and committees in navigating this complex area.
What Is Strata Insurance?
Strata insurance is a collective policy arranged by the Owners Corporation (via the strata manager) to cover the building and shared areas. It’s a legal requirement in every Australian state and territory.
The policy typically includes:
- Building structure (e.g., walls, roof, fixtures)
- Common property (e.g., foyers, stairwells, garages)
- Shared equipment (e.g., lifts, security systems)
- Public liability (injury or damage occurring on common property)
What About Individual Lot Owners?
Strata insurance does not cover:
- Internal contents like furniture, electronics, rugs, etc.
- Upgrades you’ve made (e.g., high-end appliances or luxury flooring)
- Loss of rent or temporary relocation
- Accidental damage inside your unit
Solution: Lot owners should take out Contents Insurance or Landlord Insurance (for investors) to cover these gaps.
How Are Insurance Premiums Calculated?
Premiums are influenced by:
- Building size and condition
- Claims history
- Location (risk of floods, storms, etc.)
- Age of the property
- Value of the insured building
- Optional extras (e.g., machinery breakdown or voluntary workers)
The strata committee, with Beyond Strata’s guidance, regularly reviews the policy to ensure adequate coverage at a competitive price.