Insurance for Residential Stratas: What’s Included

If you manage your residential strata, chances are the topic of strata insurance was discussed at the last strata meeting but was everyone aware of what this type of insurance does and doesn’t cover?

In Australia, it is mandatory to have insurance for strata title properties. However, states and territories have different requirements so check that your policy meets minimum legal requirements. The cost of the premiums are shared amongst unit owners and paid out of the strata fees they pay.

Strata insurance doesn’t cover the personal contents of strata units. Unit owners and tenants need to take out separate contents insurance.


What does Residential Strata Insurance include?

  • Buildings – includes walls, ceilings, windows, foyer, lifts, car park, fences, balconies, swimming pools, etc
  • Common area contents – includes items such as appliances, equipment, fixtures and fittings, lobby furniture, etc
  • Liability – public liability insurance
  • Loss of rent / temporary accommodation – residents provided temporary accommodation if a unit is not habitable following an insured event
  • Office Bearers’ Liability – protection for body corporate committee members against losses arising from wrongful acts committed in the course of carrying out their duties
  • Fidelity Guarantee – cover in the event a member of the body corporate commits fraud
  • Workers’ Compensation – benefits for someone commissioned to complete work on the property who is injured or killed
  • Voluntary Workers – benefits paid to a worker who is injured or killed while engaged in voluntary work for the Body Corporate


Cost of Premiums

Strata insurance usually costs the same or less for a unit owner than the premium paid by the owner of a stand-alone house in the same suburb.

The cost of premiums is calculated on factors including:

  • Mandatory requirements of the state
  • Government taxes on insurance (stamp duty and GST)
  • Age and condition of the building
  • Replacement cost of the building
  • Risk profile of the suburb
  • Claims history of the complex
  • Vulnerability of the insured property to an insured event (ie age, building design and materials)
  • Any commercial activities undertaken such as holiday letting
  • Level of excess the body corporate has selected if they need to make a claim
  • The costs of common property ie the car parks, lifts and pool


Example of Strata Insurance at Work

During a winter storm, a large tree fell on a unit causing a large crack in the brickwork of the exterior wall and a broken window causing water damage to a lounge and carpet in the unit. The unit’s tenant had to move out for one month while the repairs were made.

The engineer’s professional fees and the cost of repairs to the eaves, brickwork and window were claimed against the strata insurance policy. The rent on the tenant’s temporary accommodation was also covered by the strata insurance. The tenant claimed on his own content insurance for the replacement of the damaged lounge and carpet.

Phoenix Insurance Brokers Pty Ltd can source the right policy for your residential strata at a competitive price. Call 9367 7399 to speak to one of our experienced strata brokers for information and advice for your strata or complete our online quote form and we’ll get back to you.

About Kylie Hardy

Kylie has over 25 years’ experience in the Insurance Industry, starting her career straight from high school. Kylie joined Phoenix in 1996 as a receptionist and since then has worked her way from the reception desk to the respected Senior Broker that she is today.

A Rockingham local, Kylie has spent many years supporting clients in the Rockingham / Kwinana / Baldivis and Port Kennedy areas but also has clients throughout Western Australia.

Please contact Phoenix Insurance Brokers Pty Ltd today to discuss your Insurance needs.