Damage and wear and tear are a natural part of owning a home, but in strata living it can be tricky to understand where your insurance cover ends and the strata insurance cover begins. Here we take a look at what your strata and personal insurance should generally cover.
How does strata insurance differ from personal contents insurance?
- Strata insurance is a compulsory form of insurance taken out by your strata committee. By law it must cover the replacement cost of all common property that you and other owners own collectively within the strata building or property. Your strata manager is responsible for obtaining quotes for your strata insurance, and as of 30 November 2016 in NSW they now need to gain quotes from three separate providers for your strata committee to consider upon renewal. Your strata manager also needs to disclose any insurance commissions received by insurance providers to keep the process fair and transparent.
- Contents insurance is personal home insurance for items that you own inside your personal unit. It’s voluntary (but recommended), and can be used to cover everything not included in your strata insurance. If you’re living in strata complex you should not need to purchase personal home or building insurance as this will all be typically covered in strata insurance.
- Public liability insurance is a type of compulsory strata insurance that provides cover in the event of someone being injured on that strata property. With the new NSW law reforms, the previous minimum $10 million cover for public liability insurance has now been increased to a minimum cover of $20 million.
So what is included within strata insurance?
The definition of common and private property is slightly different from strata scheme to strata scheme, but generally the strata-insured common property will include the walls, windows, floors and roof of your building as well as elevators, carparks, swimming pools and gardening equipment. Strata insurance also covers common property service fittings such as water pipes and electrical conduits within walls. Specific strata insurance policies may include exceptions that relate to cover in the case of specific natural disasters, so it is important to read your strata’s insurance policy in detail to make sure everything is covered.
The insurance premiums you pay as part of your strata levies will depend on a number of factors, including the age and condition of the property, the risk profile of its location and its history of previous claims.
Strata insurance is not one-size-fits-all
Remember, every strata property is different and you will always need to check your specific policy with your own strata manager or strata committee. If Real Property Services is your strata managing agent, give our team a call on (02) 9960 4713 or send us a quick message today and we’ll be happy to help you with clear information for your property.