With the apartment market on the Gold Coast and in Brisbane literally soaring to new heights at the moment, it’s important that if you own an investment property that it is adequately insured.
If you own a property covered by a body corporate, whether that be a house within a gated community, a townhouse, or an apartment, then there will be in place body corporate insurance, however this applies differently to different property styles and doesn’t necessarily cover everything, so it can be a bit confusing.
However, knowing what is and what isn’t covered can help you protect your property and avoid any disputes with the body corporate about what is covered by the body corporate insurance and what isn’t.
In Queensland, under the Body Corporate and Community Management Act the body corporate is responsible for insurances the common property, body corporate assets and the buildings on the premises. It’s important though to be aware though that the insurance of the buildings on the premises depends on how the Community Titles Scheme (“the Scheme”) is registered.
If the Scheme is registered as a Building Format Plan, then insurance will be in place for the full replacement value of each building which contains a lot.
While if the Scheme is registered as a Standard Format Plan (more common for townhouse developments), then insurance must be in place for the full replacement value of each building where there is a common wall with a building on an adjoining lot. If there are no common walls in a Standard Format Plan, then the owners are responsible for their own building insurance.
This may be the case where a townhouse development has semi-detached buildings and some buildings may not share a common wall with another building, meaning that the owner has to have there own building insurance, while neighbouring lots that do share a common wall with another building may be covered by body corporate insurance.
So what does body corporate insurance cover? The following are a few examples of what is covered:
- Toilets, basins and shower screens;
- Ducted air-conditoning units;
- Cooktops;
- Built-in cupboards and bench tops;
- Windows and doors; and
- Fixed tiling.
The most important thing to keep in mind when insuring your property is that body corporate insurance does not cover assets or liabilities of unit owners and you should take out landlord insurance to cover yourself against liabilities for damage or injury to third parties on the property.