Strata Title Property
Section 160 of the Strata Schemes Management Act 2015 states the owners corporation for a strata scheme for the whole of a building must insure the building and keep the building insured under a contract of insurance, in accordance with this Division, that insures the building if it is destroyed or damaged by fire, lightning, explosion or any other occurrence specified in the policy (a “damage policy” ).
Section 161 of the Strata Schemes Management Act 2015 states a damage policy for a building must be with an approved insurer, be in the name of the owners corporation, and any other person required to insure under Section 160 and provide for the following:
(a) the building is to be insured for at least the amount determined in accordance with the regulations,
(b) if the building is destroyed, the building is to be rebuilt or replaced so that the condition of every part of the rebuilt or replacement building is not worse or less extensive than that part when new,
(c) if the building is damaged but not destroyed, the damaged part of the building is to be repaired or restored so that the condition is not worse or less extensive than that part when new,
(d) expenses incurred in removing debris are payable,
(e) the remuneration of architects and other persons whose services are necessary as an incident to the rebuilding, replacement, repair or restoration is payable.
Section 39 of the Strata Schemes Management Regulation 2016 states the manner of calculation for an insurance limit under damage policy as follows;
(1) For the purposes of section 161 (1) (a) of the Act, the minimum amount for which a building is to be insured is to be not less than the amount calculated in accordance with subclause (2).
(2) For the purposes of section 161 (2) of the Act, the amount to which the liability of an insurer may be limited under a damage policy is to be calculated by adding together the following amounts:
(a) the estimated cost, as at the date of commencement of the damage policy, of
(i) carrying out the work that a damage policy is required to provide for under section 161 of the Act, and
(ii) making the payments that a damage policy is required to provide for under section 161 of the Act,
(b) the estimated amount by which expenditure referred to in the preceding paragraphs may increase during the period of 24 months following the date of commencement of the damage policy.
(3) The amounts referred to in subclause (2) (a) and (b) are to be calculated so as to include any applicable taxes, fees and charges (including taxes, fees and charges of the Commonwealth).
Community, Neighbourhood & Precinct Property
Building insurance valuations in order to comply with the Section 39 of the Community Land Management Act 1989 and states the following;
(1) An association is guilty of an offence if any building or structure on its association property is not at all times fully insured, with an insurer approved by the Minister, against damage or destruction by fire, lightning, explosion or other prescribed risk.
(2) Any such building or structure is to be insured for not less than the amount determined in accordance with the regulations.
Although not a legal requirement it is essential for you property to be correctly insured to avoid potential loss from your co insurance or averaging clause.
The best method is by a proper building insurance valuation.
On receiving written instructions we will:-
- inspect the subject property, photo all buildings and improvements, note any unique or specific factors relative to the subject property
- calculate building areas, assess the type of materials for complete replacement and/or reinstatement of the building and its surrounds
- estimate the replacement and/or reinstatement cost the improvements and materials via Rawlinsons Construction Handbook and apply the formula specified by the Section 39 of the Strata Schemes Management Regulation 2016
- provide a detailed report with a recommended building sum insured including all plans & current photographs
- if required we can provide specific insurable amounts for loss of rent, common contents and catastrophe cover
- liase with owners to discuss valuation methodology, building areas and construction rates if required
All properties are inspected and we do not conduct desktop valuations.