Understanding Strata Insurance

A quick guide to help you understand the different components of your strata insurance.

Building Cover

Body Corporates / Owners Corporations are obligated by law to take out insurance on all buildings with an approved insurer.
Building cover can extend to not only the physical structure but also the common property fixtures and fittings such as carpets in common areas, hot water systems, light fittings, internal doors, common air conditioning systems and intercom systems, etc.

Amount to be Insured

The insured amount factors in the estimated cost of:

  • Replacement of the building
  • Removal of all debris
  • Professional fees for architects, engineers and other persons whose services are necessary

Furthermore, most states have requirements to ensure that a building valuation be conducted on a regular basis for insurance purposes.

Public Liability

States also stipulate minimum requirements for public liability that strata owners are insured against death or injury to a person or damage to property.

Tip – Public Liability insurance should also be considered by individual lot owners for any special circumstances involving their lot and not covered by the insurance taken out by the Body Corporate / Owners Corporation. Speak to an insurance specialist if you believe you might need to take out additional insurance.

Workers Compensation

Another legal requirement on Body Corporates / Owners Corporations is to have in place Workers Compensation insurance that serves to protect employers and injured workers from financial costs when a worker sustains a work-related injury or disease.

Voluntary Workers Insurance

Additionally Body Corporates / Owners Corporation should also insurance for voluntary workers to protect against any damages that it may become liable for when a person does any voluntary work on the common property or for the building.

These are just some of the fundamental elements of strata insurance that are either mandatory by law or highly recommended to have in place. Other insurances that you may consider for your building include contractors insurance, officer bearers insurance (for the Committee members), insurance to cover misappropriation of funds and contents insurance.

For more information on strata insurance visit:

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