In my OC, we have handled similar situations like this:
- If the damage to a lot’s property was caused by a fault in common property, the OC is responsible for the damage and any subsequent repair. How the OC arranges the repair of the lot property is up to the OC. It might be an insurance claim, it might be a claim against the builder, the OC might pay out of common funds, but the OC is still responsible. If it’s an insurance claim, the OC claims either for damage under building cover (even for fixtures that belong to the lot owner) or against the liability cover due to damage to other’s property (eg when it’s not the building or a fixture that was damaged). As the OC is responsible for the damage, the OC pays any excess.
- If the damage to a lot’s property was not caused by a fault in common property, the OC is not responsible for the damage but will assist if the OC’s insurance will cover the damage. As the OC was not responsible for the damage, the lot owner pays any excess.