I currently have landlords insurance on two properties. If one of my units burned down or was flooded, would body corporate insurance cover that or do I have to take out my own building insurance?
To determine this, first you need to find out what type of survey scheme/plan your properties are registered under. It all depends on this format and who you’re sharing walls with.
The two common types of survey plan are:
- building format or
- standard format
Schemes that are registered under a building format plan of subdivision are usually multi-storey buildings like blocks of residential units. Some townhouses can also be registered under a building format plan of subdivision.
In this type of scheme, a body corporate must insure (for the full replacement value) each building that contains an owner’s lot (e.g. a unit or apartment).
So, in this case body corporate insurance will cover your property and you don’t need to take out your own separate building insurance.
Schemes are usually registered under a standard format plan of subdivision if they are low-rise developments. An example is a townhouse complex where there is a building on each lot with a backyard or courtyard.
The body corporate must insure (for the full replacement value) each building that shares a wall with another building (known as a common wall).
The lot owner is responsible for insuring their own building if it is:
- free standing—does not share a common wall with another building and
- registered under a standard format plan
If one of your properties falls into their category, it’s your responsibility to take out your own building insurance.
We suggest you contact the body corporate strata manager to provide a copy of the policy document that would outline what is insured by the body corporate.
(Insurance matters can be quite complex as well in that in a standard format plan if they do have adjourning walls in some of the units say a duplex, then the body corporate does have to insure these but can ask that the owners reimbursed the body corporate.)