The Lot Owner is responsible for the Hot water service that is exclusive to a lot and is inside a lot. The Lot Owner is responsible for any damage caused by a leaking HWS.
I can’t understand why the strata insurance paid for the repairs to the Lot? Was the Lot owner on the Committee by any chance?
I would question why the OC paid for the repairs to the water affected apartment(s).
FYI – Some internal HWS with a drip tray also have Mildred Valve to help prevent flooding. The Mildred Valves
is a leak-sensing automated shut-Off valve for internally installed hot water systems. The batteries need to be changed to ensure that the valve will be activated when water starts to pool in the tray. Perhaps the Lot owner had not changed the battery. The batteries should be changed once a year.