Strata insurance is a legal requirement in all Australian states. Strata committees must maintain adequate strata insurance to protect the building and common property, the owners corporation or body corporate, as well as those who live, work, visit or interact with the building.
But just like any insurance product on the market, you get what you pay for.
It is in the committee’s best interest to speak with their Community Manager about suitable strata insurance coverage for their building. They will then contact strata insurance experts to obtain competitive but comparative quotes for the level of cover required.
CHU, one of Australia’s leading strata insurance specialists, sees common residential insurance claims every day.
From storms and floods, fire damage, vandalism and break-ins, even legal disputes, CHU has settled thousands of claims over the years, and has seen how some of these claims may have been avoided.
Based on internal data, CHU has provided some tips to help avoid common claims from occurring in your building.
Leaks and water damage
Nearly 45% of residential strata claims lodged are the result of water damage.
Whether it is a burst pipe, overflowing water or even roof damage, finding the source of leaks is not always visual or easy to detect. Thanks to modern technology, finding the location of the pipe and its leak can be detected with minimal exploratory destruction.
Common places to check your property for signs of water damage or a potential flooding risk:
- Check the warranty expiry date on the collar of flexi hoses and that they are intact on all personal and communal appliances which require plumbing such as washing machines, dishwashers and water filters.
- Clean and maintain roof and gutters for damaged tiles, obstructions or blockages.
- Investigate any reports of water pressure changing or an increase in water charges. This could be due to a leak behind the walls or with the garden reticulation.
- Inspect walls and ceilings for blistering, water marks or stains.
- Don’t walk away when filling the bath or sink.
- Turn off the water when leaving your residence for a longer period of time.
Storms, floods and weather events
Australia is famous for its great weather, but it can be quite turbulent and sometimes extreme. Natural events including storms make up for around 25% of residential claims each year.
Make sure your building is storm-ready by:
- Keeping contents and appliances out of areas that are at risk of flooding.
- Clearing gutters and balconies regularly, to allow rainwater to drain.
- Trim back trees and branches.
If a storm is approaching, tune into local weather reports for updates and check in on your neighbours and tenants that they are safe and prepared.
Accidental damage claims can be frustrating because, as the name suggests, they could have been avoided.
Communal areas should be well maintained and kept clean and tidy. To prevent an incident, any high traffic areas should be kept clear from obstructions.
Always check before you dig in the garden to prevent damage and disruption to reticulation or infrastructure networks. Dial Before You Dig is a free national referral service designed to assist in preventing damage. Visit www.1100.com.au
Use professional tradespersons for maintenance and/or installations.
Whilst this may not be the most common claim, Legal Liability can be the most expensive. It covers you when you’re legally responsible to pay compensation if an incident has occurred.
This could include covering the legal and indemnity costs for:
- Accidental damage to someone’s personal property in common areas, including tradespersons.
- Injury or death caused by negligence, and any loss of earnings due to injury.
- Wrongful acts by an Office Bearer (Chairperson, Secretary or Treasurer of the committee) for a breach of duty or clerical mistake.
The best way to help avoid a legal liability claim is to stay vigilant. Keep an eye out for any potential safety hazards, take all reasonable action to minimise a risk as soon as possible, and report any potential concerns to your Community Manager or committee member.
If a fire starts in your building, it can spread fast and the damage can quickly become a total loss.
As well as having fire safety equipment fitted, service your appliances regularly and act quickly if someone reports an issue with wiring or power outlets. Consider installing an RCD (residual current device) for additional protection that ordinary fuses and circuit-breakers cannot provide.
Some common sources of residential fires to be aware of include:
- Faulty wiring or old appliances causing electrical/mechanical fires, such as air conditioning units or dryers.
- Lint filters on washing machines and dryers that are not cleaned.
- Kitchen fires caused by fryers, overheating pans and hotplates.
- Candles and incense burners left unattended.
- Cigarette related fires – indoors and on terraces and balconies.
Theft, vandalism and malicious damage
Items in common areas, such as barbeques, gardening tools and gym equipment, can be attractive targets for burglars and can be easier to gain access to these areas rather than inside a resident’s home.
As well as replacing any stolen items, you might also have to claim for broken windows and doors or new locks if the intruders have forced their way into the building. Sometimes a small break-in could result in a much larger insurance claim.
Actions you can take to help prevent a break-in or theft in the building:
- Introduce and familiarise yourself with your neighbours so you’ll recognise anyone out of place.
- Don’t be afraid to question unfamiliar people entering the property.
- Consider adding smart locks to shared areas like garages, terraces and gyms.
- Don’t leave doors propped open – especially during deliveries or removals.
- Wait for the shared garage door to be closed before exiting the driveway.
CHU suggests increasing security such as adding intercoms, motion lights or security cameras. Whilst this could be a costly exercise initially, it is a good investment and could assist in a lower insurance premium.
Should you have any queries regarding your residential strata insurance, please speak with your designated Community Manager.
Content provided with approval from CHU. Estimates based on CHU Assess claims. Read the full article.