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A major insurer was justified in raising strata premiums by 500% due to four-year claims history, according to finance watchdog AFCA.
[See the full post at: Five-fold increase in insurance costs ‘justified’]
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
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Strata insurance claims are an unfortunate fact of life. However there are ways to minimise their impacts and keep premiums lower.
Have a regular, ongoing inspection and maintenance regime for plumbing, drainage, roof, electrical and plant.
Deal with repairs routinely and promptly.
Maintain a healthy fund balance so you can ‘self-insure’ smaller jobs.
Consider setting higher excesses to lower premiums
Don’t give your SM the power to lodge claims without committee approval
Always include your excess in yearly budgets, and carry it over
Always shop around insurance and scrutinise policies.
Accidents can and do happen, but with a bit of effort it’s possible to put your OC in a better position to handle them.
Jimmy’s article is a caution for all of us.
Have a regular, ongoing inspection and maintenance regime for plumbing, drainage, roof, electrical and plant.
Deal with repairs routinely and promptly.
Maintain a healthy fund balance so you can ‘self-insure’ smaller jobs.
Agreed. It is a false economy to think that you can avoid paying for something by claiming it on insurance. Any claim is going to increase ALL future premiums. I aim to make no claims except if the entire building is lost by fire or natural disaster.
Consider setting higher excesses to lower premiums
The highest excess I could get was $5,000.
Always include your excess in yearly budgets, and carry it over
Great idea! I have now included it in my budget for next year.
Always shop around insurance and scrutinise policies.
In NSW, the SSMA 2015 requires us to seek three quotes for building insurance. When I sought the policy myself, I learnt that we could exclude “contents insurance” because we had no contents. That made the premium cheaper. Also, by obtaining the policy myself, I avoided the 20% insurance broker commission. It saddens me that we paid 20% commission for a professional broker, who did not even ask us if we needed contents insurance.
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