When you own an apartment as an investor or landlord, you can purchase numerous forms of insurance to protect yourself and your property, including building and landlord insurance. Property experts advise that anyone investing in a residential property should always have adequate insurance coverage to protect oneself in the case of unexpected or deliberate property damage, legal liability in the event of accidents, or loss of rental income. For landlords and apartment owners, most banks and other financial organisations offer a variety of insurance choices, explains the residential strata insurance experts. When shopping for insurance, the best strategy is to research and evaluate different policies in terms of coverage and costs – some policies, for example, limit flood or landslide coverage or charge higher premiums.
In most Australian jurisdictions, another type of insurance called strata insurance (sometimes known as body corporate cover) is required. Strata insurance is required in most residential apartment complexes and is administered by the owners corporation or a registered strata managing agent. Under strata title, the owners corporation is fully culpable for securing the building and shared amenities. Strata insurance, which can be included in the regular building policy that protects the units or purchased separately, protects the building’s owners in the event of legal responsibility claims with the help of insurance brokers Adelaide.
What can Strata Insurance cover?
- Building/Common Contents: Covers loss or damage to insured property, including cyclone, tropical storm, and flood damage. It’s worth noting, though, that flooding isn’t always included.
- Legal Liability: Covers legal liability of up to $20 million originating from your ownership.
- Personal Accident (Voluntary Workers): Provides a loss of income compensation to a volunteer worker who is insured while performing unpaid work for you.
- Fidelity Guarantee: Protects monies held by the body corporate from misappropriation or theft by a panel member.
- Office Bearers Liability: Provides legal protection for office bearers who are held legally accountable for improper activities such as giving property managers erroneous instructions or not exercising due care when dealing on behalf of unit owners.
- Catastrophe Cover: It is normal for building expenses to rise after a major catastrophe that causes widespread property damage, and as a result, your construction sum covered may be insufficient.
Strata insurance is often paid out of an owner’s quarterly strata fees, and the cost varies depending on the type of policy chosen as well as a number of other criteria, such as:
- The building’s position, age, and general condition
- The construction method
- The body corporate’s previous insurance claims
- The scope of any commercial activity carried out in the structure (for example, short term rental accommodation)
- The cost of retaining the shared spaces and any amenities like a pool or a parking lot.
- In the event of a claim, the amount of excess payment set by the owners corporation.
Strata insurance prices can rise in price over time, just like building and landlord insurance premiums, so investors should be aware of the possibilities and consider these costs into their budget.
Appointing a property manager to oversee your property, look after your renters, and ensure you are complying with the relevant duties is one of the greatest property investment methods, especially if you are a first-time landlord. They will be able to help you with all areas of property upkeep, including the sorts of insurance coverage you should have and your responsibilities as an owner under strata regulations and legislation.
