Body corporate and unit owner's insurance: Who covers what?

At the Annual General Meeting each year the body corporates insurance is reviewed. Under the legislation the body corporate must insure the building and hold public liability insurance. The details of these policies vary depending on the insurance policy and the terms negotiated by the body corporates insurance broker. The unit owner should insure their contents that is their furniture and personal belongings. Fixtures are included in the body corporate insurance however owners should be aware most insurance policies include an excess which may be payable by the owner.

The building must be adequately covered, we recommend that every 5 years the body corporate obtains an insurance replacement valuation to make sure the property is adequately covered. In addition to this each year the cover should be increased at least by the CPI or the construction price index for the area.

Other insurance the body corporate may decide to hold include;

• Machinery Breakdown insurance; when building have a lot of equipment to maintain.
• Income Protection; when owners want to cover loss of rent if the property is damaged or destroyed.
• Office Bearers Liability Insurance; when the committee wants to be covered in the event of them making a decision that they could be found liable for a loss incurred by the owners or the body corporate.