Home insurance is a necessary part of owning property. Whether it is your family home or an investment property, the risk is too great to not have some form of cover.
If you want to compare home insurance for a strata property it is worth considering what is already covered by the body corporate.
Unlike a stand-alone property, such as a house, strata buildings are covered by body corporate or strata insurance.
While the exact requirements differ in each state and territory, strata insurance is mandatory for all body corporates premises. The strata manager must ensure that the building is insured and that there is protection against liability claims. The owners pay for the insurance through the body corporate fees.
Strata insurance only covers common property, land and facilities.
This includes things such as:
- The floor in the foyer
- Swimming pools
- Ducted air conditioning
Like home insurance, a strata insurance policy will come with several exclusions, or things it won’t cover. Each insurance company choose its own exclusions, so make sure you are aware of what they are. They might be things like:
- Flood damage
- Damage to fencing
It is important to understand that strata insurance is for common property only. It will not cover anything that is your property.
What is considered your property? Anything from the paint in.
Strata insurance will not cover:
- Paint or wallpaper
- Light fittings
Even if the damage was caused by another property or common area!
Whether you live in a strata property or own one to lease, you need to get additional insurance to cover your personal property. This can either be standard contents insurance or landlord’s insurance.
All insurance companies have different exclusions and requirements. You must find out what the strata insurance covers, so you can ensure your personal insurance will cover anything missing.
In summary, while strata insurance provides cover for your property as an entire building, it does little to help you should something happen inside your property. Remember, your property may be damaged by problems from outside your property, which you have no ability to control.
Your strata property is only truly insured if you get additional contents or landlord’s insurance.