For strata property owners, the common areas are a shared responsibility. This puts strata owners in a unique position, where their insurance cost is shared, and so too are the risks associated with damage or repair to these common areas. This is where it is imperative to ensure strata companies have adequate strata insurance.
Strata properties require specialised insurance solutions to safeguard against risks. Choosing the right insurance is paramount to a smooth process should disaster strike. The last thing owners need post a claim event, is to find that their insurance does not adequately cover them.
To ensure effective coverage and premium assessment, CHU, a leading strata insurance provider, emphasises the significance of underwriting due diligence and accurate building valuations.
Delivering a high service standard through underwriting excellence
CHU's commitment to offering high quality insurance solutions to the strata industry hinges on obtaining quality information in a timely manner. Underwriting, a pivotal aspect of insurance risk assessment, involves meticulous due diligence. Gathering comprehensive data about specific risks, including factors like construction, occupancy, protection, and exposure, is indispensable. By comprehending the intricacies of the risk proposed for insurance and its potential impact, CHU can provide the most appropriate coverage.
Strata Managers play a vital role in this process. Collaborating with their strata company and insurance broker, if applicable, is essential. They facilitate the acquisition of requested information, enabling CHU to make informed underwriting decisions, extend coverage, and calculate relevant premiums. Proactive cooperation and timely information sharing are imperative to secure the best possible insurance solution.
The Significance of Accurate Building Valuations
A crucial first step to lower the risk of being underinsured is to obtain accurate building valuation. The value attributed to a property must align with actual rebuilding or repair costs and generally speaking shouldtake into consideration removal of debris, professional fees and an allowance for cost escalation over a period of time. This alignment minimises the potentailof underinsurance, assuring property owners that their investment is well protected.
Accurate building valuations offer substantial benefits:
Mitigating Financial Risk: In the unfortunate event of a disaster, insufficient insurance payouts can lead to substantial financial burden in covering the shortfall, potentially resulting in financial strain and vulnerability.
Preventing Insurance Disputes: Accurate building valuations act as a safeguard against disputes with insurance providers regarding coverage adequacy. A proactive approach streamlines the claims process and ensures smooth interactions with insurance companies.
Monitoring the state of the strata market
Strata Insurance is complex, which is why it is important to ensure you are working collaboratively and considering the state of the market. There are a number of factors that must be assessed when making these critical decisions in consultation with all of the key stakeholders.
To learn more about the current state of the strata market, CHU’s comprehensive guide outlines some of the factors that influence the market including scarcity of building material impacting the cost of claims, the increase in catastrophic weather, the cost of reinsurance, and various policy level factors.
CHU's commitment to providing comprehensive insurance coverage is reinforced by the cooperation of all parties involved. Strata Managers, strata companies, insurance brokers, and property owners working together ensures that essential information is collected, valuations are accurate, and policies are tailored to mitigate risks effectively.
In a dynamic landscape where, unforeseen events can disrupt the norm, insurance coverage acts as a safety net, offering peace of mind to property owners. Through collaborative efforts and informed decision-making, the strata industry can navigate uncertainties with confidence, knowing they are fortified against potential challenges.
CHU has released a State of The Strata Market Report 22/23 edition.
Link below:
Disclaimer: Insurance issued by QBE Insurance (Australia) Limited ABN 78 003 191 035 and distributed by CHU Underwriting Agencies Pty Ltd ABN 18 001 580 070 AFSL 243261. Any advice in this article is general in nature and does not take account of your personal objectives, financial situation and needs. Please read the relevant Product Disclosure Statement (‘PDS’), Financial Services Guide (‘FSG’), and the Target Market Determination (‘TMD’) which can be viewed at www.chu.com.au or obtained by contacting CHU directly. CHU Services Pty Ltd t/as CHU Inspect (ABN 99 616 086 269).
This article was brought to you by CHU Underwriting Agencies