Condominium insurance that you purchase as an owner does not cover the entire building, but rather only the inside of your unit and your belongings. A portion of the strata fees goes toward a separate strata insurance policy that insures the building. Buyers should request a copy of the building insurance policy and look at what the renewal date is, look at what the values are, the deductibles and what the rate is. If it is coming up for renewal wait to see what the final figure is. Why? For some, the cost of building insurance is going to rise – a lot. Higher premiums will affect owners’ monthly strata fees and in some cases, individual owners may also have to carry the full load of an insurance claim if it is found that they have been responsible or the cause of the claim.
Condominium owners should buy homeowner’s insurance that covers strata deductibles. However, most will only cover up to $50,000 for individual owners.
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