When working out what is covered by Body Corporate Insurance, the easiest way to think about it is the same way you would separate house and contents insurance for a stand alone property. The Body Corporate insurance is the house cover, while all possessions are covered by your personal contents insurance.
What is covered
Body Corporate insurance covers the building and all common or shared property including lifts, stairwells, hallways, foyers and the exterior of the building
. There are three main rules with regard to body corporate insurance:
The entire property must be insured under one policy in the name of the Body Corporate – this means that individual owners need not (nor can they) insure their unit themselves.
The property must be insured for the full replacement value at all times.
The Body Corporate Chairman or appointed Body Corporate Manager is responsible for ensuring the correct insurance cover is in place. This includes obtaining valuations and receiving and paying invoices from the Body Corporate bank account.
What is NOT covered under body corporate insurance
Your personal contents including furniture, curtains and blinds are not covered by Body Corporate insurance and require contents or landlord insurance.
We highly recommend that all unit owners hold personal contents insurance policies. Depending on the policy you choose, this often provides personal liability cover should you be liable for accidental damage to anyone else’s property e.g. if you have caused flooding resulting in water damage to the apartment below. If there is flooding due to a building issue, such as pipes in the wall, this would come under the building insurance.
If your unit/apartment is tenanted, landlord insurance is recommended, to cover your property in the unit that is not covered by the building insurance e.g. curtains, blinds and any other chattels such as whiteware that belong to you. If you need assistance working out how much you should be covered for and the right policy for you, contact Kauri Financial Planning who can assist with all of your insurance needs. Read more on their website HERE.
Insurance fees and claims
Insurance is the largest expense incurred by your Body Corporate and therefore makes up a large proportion of the operating levies that you pay. The rising costs of insurance in recent years, especially in Wellington, are due to earthquake risks being reassessed after the 2014 Kaikoura earthquake and many major insurers not accepting new business in the area. At Complete Body Corp Solutions, we mitigate this where we can by gathering quotes from multiple brokers and insurers to ensure the best deal possible for the buildings we manage.
If you need to make a claim, contact your Body Corporate Manager or your Body Corporate Committee to find out what steps you need to follow. It may seem complicated, but we are here to help.