Common Residential Strata insurance claims, and how to prevent them in your property
As a strata owner and member of the Body Corporate or Owners Corporation, protecting the common property from damage, and the associated claims, is essential. That’s why it’s beneficial to know what the most common residential strata insurance claims are, so as an owner, you can do your best to avoid them in your property - protecting your residents, and your insurance premium.
Here are the 6 most common Residential Strata Insurance claims we come across at Flex Insurance and some helpful tips on how to spot them before they happen in your building:
1. Water damage
Burst pipes, leaks and overflowing water. They make up almost 40%^ of residential strata claims yearly - and often the cause is hard to spot before it’s too late. Look out for the following signs and scenarios which could pose a water damage risk to the building:
- Changes in water pressure
- Water marks or stains on walls and ceilings
- Communal appliances, such as washing machines, missing regular maintenance
- Damage to roof tiles
- Blocked guttering
- Empty units during cold winter spells - which could cause a burst flexi hose
2. Weather and Natural Events
Unfortunately we can’t control the weather, and Australia is very a storm prone country. Around 25%^ of residential claims each year are related to weather and natural events - such as lightning, flooding and hail storms.
If there is a severe weather warning in your area, follow these safety tips to try to minimise damage to the property, and more importantly to keep yourself and your neighbours safe:
- Stay up to date with the progress of the storm or weather event by tuning into local TV and radio stations
- Secure your doors and windows, and close shutters if you have them
- Look out for your neighbours or tenants and make sure they are also aware, safe and their property is secured
- Move anything valuable that could be at risk of damage from flooding
- If it’s safe to do so, secure your outdoor property and garden furniture - it also helps to make sure your property is storm ready, by keeping your gutters clean and trimming trees
3. Fire damage
Big or small, a fire can start from a range of sources in a residential building, and if not caught quickly the damage could be devastating. Some of the most common causes of fire damage in residential properties to be aware of are:
- Candles and incense burners
- Electrical fires from old or faulty appliances, including communal appliances like washers and dryers
- Kitchen fires from overheating cooking pans or hotplates
- Cigarettes - especially smoking in bedrooms or around soft furnishings. Even cigarette butts being dropped onto another balcony, igniting the furniture
- Faulty wiring, such as mechanical fires from air conditioning units or communal clothes dryer
As well as your mandatory fire safety fixtures, like smoke detectors and fire alarms. Having fire extinguishers and sprinklers in the communal areas will help to save lives, and could also lower your overall insurance premium.
4. Accidental damage
We all have our clumsy moments, and some accidents are just unavoidable. But you can reduce the risk of having to make an accidental damage claim by ensuring communal areas are clean and tidy, and free of tripping hazards. Check for worn or damaged carpets, and shoes or plants outside doors and stairwells.
Keeping communal appliances and equipment in full working order, and with clear instructions for use, can also help to reduce the possibility of an accident in the property.
5. Legal liability
Legal Liability provides cover if you are held legally responsible to pay compensation when an incident has occurred. For residential strata policies, some examples of these claims include:
- Accidental damage to personal property in common areas
- Injury or death caused by negligence
- Wrongful acts by an Office Bearer*, such as clerical mistakes, breach of duty or intimidation
- Paying the legal fees for defending a liability case
There’s no one way to negate a liability case or claim, but if you see a potential incident or suspect there might be something amiss, report it to the Body Corporate or Owners Corporation.
*An Office Bearer is the person or persons nominated by the strata committee to hold a position of authority e.g. the Chairperson, Secretary or Treasurer.
6. Malicious Damage & Theft
Although it might seem as though the tenants’ contents are more appealing to a burglar, don’t forget about the valuables in your communal areas, like gardening implements or gym equipment. As they are often in areas which are easier to access, these are a prime target for criminals.
As well as having to claim for the stolen items, there’s also often claims for damage caused by a forced entry or in the worst cases, vandalism by the culprits.
Some simple security measures you and the other residents can do to protect your property from theft or a break-in include:
- Always being vigilant
- Familiarise yourself with your neighbours and tenants, and don’t be afraid to question unfamiliar people entering the property
- Don’t prop doors open, especially when people are moving in and out
- Consider adding swipe cards or smart locks to areas like shared parking garages, gyms or recreation areas.
You could consider adding some extra security features to common areas, like cameras or security lights. Installing these might also help to reduce your premium and it may speed up your claim if you have photographic evidence.
Make sure you have the right cover
When there's a community of people living in an apartment block, duplex or townhouse, there’s always going to be unavoidable accidents or mishaps. Keeping an eye out for some common risks, and making sure you have the right insurance cover, will help put you, and your Lot Owners’ minds at ease.
^Based on the average of CHU Underwriting Agency Claims from 2015-2019.