Insurance premiums raised due to Airbnbs

shedsrus wrote:

And certainly the legislators have said OC’s cannot discriminate against STHL lots in any way.

Where did they say this? I don’t recall STHL properties being given such blanket immunity from costs associated with their usage.  I’d be grateful if you could point this out.

On the other hand, the Act (Section 82, below) says if the change of use of apartments causes your insurance premiums to rise, the owners can agree to pay the difference or may be compelled to do so by the tribunal on application by the OC or another owner.

It seems you have clear evidence that the Airbnbs have caused your insurance to increase, so the ball is in your OC’s court. If I were an owner in your block, I’d be filing my application for mediation as soon as I got the inflated insurance quote.

(1)  If the use to which a lot in a strata scheme is put causes an insurance premium for the strata scheme to be greater than it would be if it were not put to that use, so much of a contribution payable by the owner of the lot as is attributable to insurance premiums may, with the consent of the owner, be increased to reflect the extra amount of the premium.

(2)  The Tribunal may, on application, make an order for payment of contributions of a different amount to one or more contributions levied or proposed by an owners corporation on an owner if the Tribunal is of the opinion that the owner’s consent has been unreasonably refused under this section.

(3)  An application for an order under this section may be made by the lessor of a leasehold strata scheme, an owners corporation, an owner of a lot or a mortgagee in possession.

UberOwner wrote:

I think you’d be approaching the owners first to get their agreement.

Yeah, I skipped that option, exposing my misanthropic tendencies. That would indeed be the first and best approach. Interesting, though, that there is this widespread and mistaken belief that you can’t do anything about Airbnbs in your block.

The problem here is how the extra premium is defined and on what scale. There are numerous variables when it comes to underwriting strata insurance and this scenario could be applied to commercial tenancies which may attract a higher rate of premium. It is unusual that a strata insurer would blatantly increase a premium by 25% because of a few short term lettings or an Airbnb and insurers do have a tolerance for such matters when they rate the property in the first place. I have never come across that scenario before and if an insurer dictated an increase in premium for a portion of short termers I’d get it removed, look at an increased excess option for short termer claims or use another insurer. Some insurers do not even ask about short term rental/holiday let or Airbnb.

Just as an observation, increasing the insurance premiums because there are Airbnbs in the block makes perfect sense.  Wear and tear and damage is likely to increase and with a turnover of strangers so is the likelihood of accidents and personal injury.  Can anyone name an insurer who does this?  The floor is open on this one.

shedsrus wrote:

For some reason I no longer get notified of responses to my FlatChat post, even though the box is ticked, as has happened previously and I therefore assumed the topic was of no interest. Also, I no longer receive my weekly update email of new topics and stories.

No idea what has happened but it sounds like your email address may have been lost or corrupted at this end or your email server has misidentified emails from us as spam.  I will investigate.  If anyone else has had this issue, please let me know. meanwhile I have sent you a password update link.

shedsrus wrote:

During this process I became aware of a strata in our area which had indeed, created bylaws covering this insurance topic and adding an additional one requiring owners to nominate their lot as their principal place of residence in order to STHL it.

I don’t understand this.  If the owner is using the lot as their residence, then they can only be listing some rooms but not the whole property for STHL.  If they are letting the whole property as STHL but saying they are living there to by-pass by-laws, state laws or insurance rules, then they are providing false information.  And none of that will amount to a hill of beans until another resident complains that the property is being let illicitly or, even worse, a substantial insurance claim is made and the insurer turns around and says the scheme misled them on the STHL usage and the whole cover is invalidated.

The Bannerman piece is absolutely clear – if you want your airbnb property to side-step STHL rules, laws or by-laws, you have to live in it while you have guests.  Also, have a listen to our other strata legal sponsor David Sachs in our podcast this week where he discusses this subject in depth.