Residential Strata Insurance

In most cases yes. Strata legislation in all states and territories requires Residential Strata Insurance, but specific requirements vary.

The cost is shared between lot/unit owners and managed by the Owners Corporation (body corporate). Strata insurance can cover many types of dwellings including:

• Townhouse
• Unit/Flat
• Apartment
• Duplex

Strata insurance is arranged by the Owners Corporation (body corporate), not individual owners.

• All lot owners’ contribute to the premium through strata fees.

The policy covers the whole building and shared property on behalf of the group

No. Strata insurance does not cover your personal property inside your unit. You need separate contents insurance to protect belongings like furniture, appliances, clothing, and valuables. Residential Strata Insurance only covers the building structure and shared common areas.

The starting point for your property excess depends upon the building sum insured value of your building.

• Building sum insured under $2M → $1,000 excess
• Over $2M → $2,000 excess
• Over $50M → $5,000 excess

However, these excesses may be amended or others imposed for underwriting reasons such as claims history, defects, or other risk factors.

For excesses not imposed by us, owners can adjust the excess they are willing to pay which will impact on the overall premium payable. 

Yes. Exclusions are detailed in the Product Disclosure Statement (PDS).

• There are exclusions that apply to the entire policy (general exclusions).
• Additionally, there are other exclusions that are specific to certain covers within the policy (specific exclusions).

In some cases, additional exclusions may be applied depending on your building’s situation. Review your policy carefully and contact us for information on any other specific exclusions.

No. Strata insurance does not cover defects, wear and tear, or poor maintenance.

It is designed to cover sudden and unexpected damage (e.g. fire, storm or water damage), not ongoing maintenance or construction issues.

It covers you if your home becomes uninhabitable after an insured event. CHU will cover reasonable accommodation costs for owners living in their lot. If you rent out your unit, this cover also protects your rental income if tenants need to vacate.

Fidelity Guarantee is cover for the Body Corporate in the event your funds are misappropriated during the period of insurance. Whilst only required by legislation in South Australia, Fidelity Guarantee forms part of CHU’s specialised cover and is standard on all Residential Strata policies.

Common area contents are items owned by the Owners Corporation that are located in shared spaces.

Examples include:

• Garden furniture in courtyards
• Curtains or blinds in communal areas
• Fire extinguishers and shared appliances in common areas

Permanent fixtures like driveways and letterboxes are covered under the building sum insured, not contents.

No. Strata policies cannot be cancelled mid-term by individual lot owners. Strata insurance is held by the Owners Corporation, not individual owners. If an owner has sold their unit they are no longer party to the strata policy. Any adjustments such as levy contributions would be typically managed by your conveyancer through the property settlement process.

They are permanent improvements installed by a lot owner for their exclusive use. Examples include upgraded floorboards, renovated bathrooms or built-in cabinetry. These become part of the building once installed.

It covers legal costs if claims are made against members of the strata committee. Protection applies to wrongful acts, errors, or omissions committed while carrying out official duties.

Liability to others (sometimes referred to as Public Liability) is a compulsory requirement under legislation. The minimum limit of liability varies between states and territories as follows:

ACT – minimum of $10,000,000

NSW – minimum of $20,000,000, as well as mandatory cover for voluntary workers

NT – minimum of $10,000,000

QLD – minimum of $10,000,000

SA – minimum of $10,000,000, as well as mandatory cover for fidelity guarantee

TAS – minimum of $10,000,000 

VIC – minimum of $20,000,000

WA – minimum of $10,000,000

Cladding refers to material fixed to the outside of a building for decoration or protection.

• Cladding may include timber finishes, fibre cement sheeting, aluminium composite panels (ACP) or expanded polystyrene (EPS).
• Where ACP or EPS is used, CHU may request additional information from the insured.

A professional strata building valuation is the most common way to determine the appropriate sum insured.

The valuation should cover:

• Full reinstatement (like-for-like rebuild)
• Debris removal and professional fees
• Inflation and cost escalation

CHU automatically indexes your sum insured at renewal, but valuations should be carried out regularly. In some states, valuations are legally required every five years.

If your building is insured for less than its replacement value, there may be a shortfall in your claim after a major loss. If this eventuated, this would leave lot owners responsible for covering the shortfall. Ensure valuations are a regular agenda item at your building’s AGM to reduce the risk of underinsurance.

Yes. Strata insurance does not replace the need for contents or landlord insurance.

Landlord Insurance: Protects against tenant-related losses (e.g. unpaid rent, damage).

Owner-occupiers: Contents insurance covers personal belongings against theft, damage or fire.