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Underinsurance in strata - are you really protected?

Strata, also known as strata title or strata scheme, allows for individual ownership of part of a property called a ‘lot’. A e lot can be an individual apartment, unit or townhouse.

A strata-titled property owner, as well as owning the lot, also shares ownership of common property – such as driveways, gardens, lifts – with other lot owners.

Underinsurance of strata properties is a major growing concern, according to CHU, Australia’s leading strata insurance specialist.

Confusion over what your strata building insurance policy covers is the main cause of underinsurance.

For example, did you know that your mandatory residential strata insurance (insurance that the owners corporation/ body corporate have to cover the building, common property and common area contents of a strata scheme) does not cover your personal property or liability within your apartment?

There is a great misunderstanding as to what is covered by the residential strata insurance. Many customers believe much of their personal contents will be covered by this residential strata policy. This is not the case and they are often left underinsured and under protected.

From CHU’s internal data more than 30%** of CHU strata building claims affect personal property, including claims from water damage, natural events, fire, accidental damage, malicious damage and theft.

A separate contents or landlords’ insurance policy is vital to protect your personal belongings, as well as protecting you against legal liability or damage to another person’s property within your unit.

Whether a renter/tenant or lot owner, it’s important you have clear understanding of what residential strata insurance covers and what landlord and contents insurance does so you can fully protect yourself and your personal belongings. To avoid confusion between which items are insurable under the policies issued by CHU, we have provided some guidance.

What is covered by your residential strata building insurance?

Residential strata insurance provides general insurance cover for the building, shared or ‘common’ areas, common property and common area contents and legal liability in common areas:


Items Covered Strata Building Insurance Include


Refers to all buildings and underground services erected upon the building block forming the Strata Plan, including fencing as well as all permanent fixtures and fittings within a Lot.

  • Baths
  • Toilets
  • Ducted Air Conditioners
  • Windows
  • Hand Basins
  • Sinks
  • Built in cupboards


  • Fixed tiling
  • Floating floors
  • Shower screens
  • Doors
  • Paintwork
  • Wallpapering
  • Public Light fittings

Common area contents*


  • Carpets, floating floors, other temporary wall, floor and ceiling coverings within hallways and lobbies;
  • Pot plants, mirrors, and other decorations within common areas;


  • Appliances such as washing machines and dryers owned by the Body Corporate and used by all unit owners and housed in common laundries.
  • Any barbeque equipment, gardening equipment and garden or indoor furniture owned by the Body Corporate

*Based on CHU’s Residential Strata Insurance Plan

What is covered by contents or landlords insurance?

Contents will cover your household and personal possessions, such as clothing, jewellery, furniture, TV, carpets and electrical appliances. It covers the cost of repairing or replacing these possessions in the event of loss or damage. Landlords insurance will also cover loss of rent if the tenants leave without paying their rent or if the unit becomes unfit to be occupied.

Contents or Landlords Insurance will cover:


Items Covered By Contents & Landlords Insurance


  • Carpets, other temporary wall, floor and ceiling coverings
  • Curtains, blinds;
  • Personal equipment and valuables such as jewellery and watches;
  • furniture;
  • Household appliances such as dishwashers, refrigerators, washing machines and dryers
  • Entertainment equipment such as TV’s, Stereo’s and devices


  • Loss of rent if tenants fails to pay rent
  • Permanent light fittings;

^Based on CHU’s Landlords and Contents Insurance for Strata Policies

Legal Liability

A very important component of landlords and contents insurance is what’s called legal liability cover. Legal liability cover protects you against financial loss if your actions, negligence or the condition of your property is found to cause a person to be injured or killed

It’s important you read the residential strata policy purchased by the body corporate/ owners corporation to understand what is and is not covered inside your lot/unit so you can take out the appropriate content or landlords cover. Insurance on these items is the responsibility of the owner or tenant and not part of the residential strata insurance policy. 

For more information about CHU’s Landlords and Contents Insurance policies head to CHU Landlords Insurance for Strata and CHU Contents Insurance for Strata.

Excess Waived

CHU is one of Australia’s largest and most awarded underwriting agencies. If your residential strata insurance is managed by CHU you receive these additional benefits: 

  • Save on your excess payment: if CHU insures your building and you and the body corporate / owners corporate make a valid claim for the same incident.
  • Speedier repairs: If your personal property and building is damaged in the same incident, your property will be repaired or replaced quicker.
** Estimate based on CHU Assess claims

CHU Underwriting Agencies Pty Ltd (ABN 18 001 580 070, AFS Licence No: 243261) acts under a binding authority as agent of the insurer QBE Insurance (Australia) Limited (ABN 78 003 191 035, AFS Licence No: 239545). Terms, conditions, limits and exclusions apply to the products referred to above. Any advice in this article is general advice only and has been prepared without taking into account your objectives, financial situation or needs. Before making a decision to acquire any product(s) or to continue to hold any product we recommend that you consider whether it is appropriate for your circumstances and read the relevant Product Disclosure Statement which can be viewed on this website or obtained by contacting CHU directly.