The cost of insurance for your property can vary considerably from one provider to another, but policies with higher premiums do not necessarily provide a higher level of cover.
It’s important to shop around and obtain quotes when selecting strata scheme insurance for your building, in the same way that you would when looking for the personal cover for your home, car, or life!
Here are a few key considerations and common pitfalls to be aware of when arranging apartment strata insurance.
Compare & contrast
Once you have established which insurers will be able to provide the strata scheme cover you require, you can make an informed choice on who provides the best level of cover for your budget. It’s not advisable to go for the cheapest option if it doesn’t provide the level of cover that you need.
Remember to break down the cost of the cover between the number of lots in your building to get a better understanding of what the cost impact will be, and find out what comparably sized buildings in your locale are paying for their cover. Your strata manager can also assist by recommending a broker who can source quotes for the most suitable policy.
Agree on a reasonable budget
One of the primary complaints among property owners is fees, so prior to deciding upon an insurer, get the committee together to discuss and agree upon what would be an appropriate amount of excess for each property owner to wear in the event of a claim.
Once you have determined what level of excess you’d be willing to pay to drive down the premium cost, negotiate that with your insurer, so you can secure cover at an affordable rate rather than having to take out a cheaper, inferior policy where you compromise on the inclusions.
Know your property & look after it
It’s critical when ascertaining whether you’re getting a good deal for your strata scheme insurance cover that you know what it would cost to replace your property in the event of a catastrophic event. A property valuer can provide you with a quote to this effect.
Also, if your property has been built to withstand the severest of weather events, such as a tropical cyclone, providing evidence of this to your insurer could reduce the cost of your cover. Engage the services of a qualified structural engineer to produce a report that rates your building’s capacity to deal with such an event.
In addition, it’s worthwhile monitoring the claims made. Are owners making claims for building maintenance issues that can be avoided through routine checks and minor ongoing repairs? If so, by applying a more proactive approach to building maintenance, associated costs can be further reduced, which will also drive the cost of insurance premiums downwards.
‘This is why the approach we take to building maintenance and preventative measures at PICA Group is second to none, as it is such an important factor in driving down costs for owners while keeping buildings in first-rate condition’, says PICA Group CEO, Greg Nash.
We hope these tips have shed some light on how to arrange the best apartment strata insurance for your building.
For more advice on looking after your property in a strata building check out these articles: how to dismiss your strata manager, what to consider when renewing your strata agency and strata 101: what you need to know before buying off the plan.
The information provided is a general guide only and is not intended as a substitute for legal advice. The company disclaims all responsibly and liability for any expenses, losses, damages and costs which might be incurred as a result of the information provided by the company.