Strata Insurance: What Is And Isn’t Covered?

What does your Owners Corporation insurance cover?

Your Owners Corporation’s strata insurance policy covers you for a lot of things.

As set out in the Owners Corporation Act (VIC) 2006, Owners Corporations must take out insurance to cover all buildings on the Plan of Subdivision.

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These policies typically cover the building structure on behalf of all owners within any given Owners Corporation.

Generally speaking, most strata insurance policies cover material damage as a result of an insured peril (for instance flooding or an accident such as a car crashing into a building) to structural fixtures including fixed plant, machinery and underground services.

Some of these items include built-in ovens, stovetops, kitchen cupboards, hand basins, baths and showers.

Strata policies also generally provide office bearers cover for those who hold positions on your Owners Corporation committee, as well as public liability cover.

Of course, a strata insurance policy should also cover you and fellow owners for the entire replacement of the building – in line with your insurance valuations.

In short, your Owners Corporation’s insurance policy covers you and your fellow owners for a lot.

What doesn’t Owners Corporation insurance cover?

But what doesn’t your policy cover?

As a leading Melbourne Owners Corporation manager, Strata Plan fields plenty of questions about what is and isn’t covered in your building’s policy.

Here are our top-five most frequently asked question about what IS NOT included in your policy.

My storage cage was broken into, is that covered by strata insurance?

As more and more people move into apartments, the use of storage cages has grown exponentially in recent years.

Unfortunately, as more people using storage cages to store items of value that aren’t being used or don’t fit into their apartments, these cages have become an easy target for would-be criminals.

While storage cages are usually located on common property – typically basement car parks – their contents are not covered by strata insurance policies.

As detailed above, strata insurance policies are designed to cover the building structure including fixtures and fittings and public liability for common areas.

It is not designed to cover personal contents, regardless of where they are stored.

Even if you do take out a personal contents policy, you are not guaranteed cover for storage cage break-ins.

If you do choose to take out a personal contents insurance policy, it’s important to ensure your storage cage’s contents are also covered for property damage to ensure you are covered in the event of leaks into your cage or other sources of damage which may affect your storage cage.

Whitbread Insurance Brokers  has a thorough fact sheet looking specifically at storage cages and strata insurance, which you can access HERE.

Strata Plan also received a number of helpful tips for keeping the contents of your storage cage secure and safe from would-be criminals from the Victoria Police, which you can view HERE.

Are my contents in my unit/apartment covered in the event of theft or damage?

Much like your storage cage, the contents of your unit/apartment are not covered by strata insurance policy.

Even if the cause of the damage happened to be an “insured peril” which is covered by your Owners Corporation’s strata insurance policy, any damage to your personal contents is not covered by the building’s insurance.

This includes carpets, curtains, blinds, light fittings and appliances that are not hard wired into the premises.

It definitely does not include your personal furniture, gadgets and other household items.

CHU, one of the largest strata insurers in Australia, defines lot owner contents as:

a. built-in or freestanding appliances such as dishwashers, washing machines and dryers; b. computers, electronic and electrical equipment, garden equipment; c. Lot Owners’ business and personal effects, furniture, furnishings, carpets, and floor rugs.”

It’s important you take out a personal household or landlords policy to ensure you are fully covered.

Are floating floors covered by the building’s insurance policy?

As the use of floating floors in modern day apartments become an increasingly standard inclusion, more and more insurers are beginning to offer coverage for floating floors in their policies.

However, this is usually an optional cover and is rarely included in a base policy.

As a general rule, it is important to check your policy to know for sure. Often, an Owners Corporation will opt for the cheapest available cover, which means optional coverage for things like floating floors may not be taken up.

Checking your insurance policy is as easy as using the enquiries form at the bottom of this page, or calling Strata Plan on 1300 278 728.

Your insurance policy should also be available on your Owners Corporation’s online customer portal.

Am I covered for vehicle damage if it occurs on the common property?

As you may have gathered from the theme of previous answers, your private property is not covered by your Owners Corporation’s insurance policy.

This extends to cars and vehicles.

Most strata insurance product disclosure statements, including the likes of Strata Community Insurance and CHU, say, “Building and Common Area Contents do not include: aircraft, caravans, trailers, Vehicles (other than garden appliances not required to be registered), hovercraft and Watercraft including their accessories or spare parts whether fitted or not.”

Check your personal car insurance to see what is and what isn’t covered when it comes to damage to or theft of or from your vehicle.

As a general rule, it’s important to never leave valuables in your car and in plain sight, while it is also advisable that any access devices are not left in your car.

A lot of the car break-ins that are reported to Strata Plan include the theft of remotes and other access devices from cars.

When this occurs, your Owners Corporation may be required to consider reprogramming all access devices to the building, which can be a costly and frustrating exercise for all involved.

Does the Owners Corporation’s insurance cover me for loss of rent?

Yes, it does, but only under certain circumstances.

Most strata insurance policies will cover you for loss of rent if your apartment or unit is deemed uninhabitable as a result of an “insured peril”.

So, for instance, if your building suffers from a burst pipe which floods your apartment and your tenant is no longer able to live in your residence, you will potentially be covered for loss of rent.

However, if your tenant simply defaults on their rental payments, your Owners Corporation’s policy will not cover you for loss of rent.

If you rent your apartment out using AirBNB, or a similar service, then you could be dealing with a whole different ballgame when it comes to insurance.

Check your Owners Corporation’s insurance policy for greater detail of what is covered.

For more help with your Owners Corporation’s insurance policy, you can always call Strata Plan’s specialist insurance team! Contact us today on 1300 278 728 or email our insurance team: spinsurance@strataplan.com.au

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(If you don't know your Plan Number, click here. You can also find your Plan of Subdivision Number on your fee notice)

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