There are a few matters to consider when dealing with insurances and building valuations under the new legislation. Below is a brief outline of these changes:
Insurance Quotes – Under the new legislation strata agents must now provide at least 3 insurance quotes on each type of insurance held by the Owners Corporation. For any reason that an agent cannot obtain 3 quotes they must provide written reasons why they cannot do so – In accordance with Section 165.
Public Liability Cover - $20,000,000 is the new minimum public liability cover against damages to property, death or bodily injury – In accordance with regulation 40
Commissions & Training Services - At every AGM a report must now be provided outlining the commissions and training services provided (in last 12 months and estimates for the coming 12 months) to the strata agent by a third party in connection with the exercise of their functions as the agent – In accordance with Section 60
Minimum building amount under damage policy – For insurance purposes the replacement building value calculation method has changed. Now an allowance for 24 month lead time from commencement of the insurance policy to reconstruct in the event of total destruction. This was previously 18 months - In accordance with Regulation 39
Building Valuations – The mandatory obligation to complete a valuation for insurance purposes every 5 years has been removed from the new legislation. However, based on regulation 39 and the recommendations of the Insurance Council, Vital Strata contends it is sensible to complete an updated valuation by a Qualified Valuer say every two to three years. This ensures your building is covered for its full replacement value in the event of complete destruction. Your home is your greatest asset and therefore every consideration should be taken to protect this major asset to avoid possible financial disaster should it not be insured for its complete cost of reconstruction.
If you need professional guidance on these matters contact Vital Strata today – We can help!
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