Building Defects, Maintenance & Insurance – What is Best Practice?

Building Defects, Maintenance & Insurance – What is Best Practice?

Professionally managing Defects and Maintenance & Repairs now take up a considerable portion of Strata Manager’s time, at an increasing cost to Owners.

Over the past fifteen years there has been a significant increase in non-compliant building practices (i.e. works not meeting the Building Code), and more recently non – compliant building products (for example the much published imported Cladding, fitted to thousands of buildings throughout Australia.

A Strata Broker Concerned with Disruption – Does StrataRatings Remove the Need for Brokers?

A Strata Broker Concerned with Disruption – Does StrataRatings Remove the Need for Brokers?

A broker has recently made some public statements of concern with how StrataRatings operates and this post will respond to each of these concerns. The original comment can be found here.

Let’s firstly identify the flow of cash to understand any financially driven biases.

Broker: Gets paid commission (usually 20%) when an Owners Corporation places a policy through them. Therefore, are incentivised to encourage schemes to use their Broking services.

StrataRatings: Gets paid a flat licencing fee ($1,250/qtr) from insurers when they use StrataRatings logos in their marketing. No incentives exist as to who with and how schemes place their policies.

The issue of legal costs – why it is more important than ever to mediate disputes.

The issue of legal costs – why it is more important than ever to mediate disputes.

When a dispute between a unit owner and Owners Corporation arises, it is easy for the Strata Committee to cease communicating with the unit owner once they have made their decision. After all, it’s a painful task to continue to talk about a ‘resolved’ (in the eyes if the OC) issue.

From the unit owner’s perspective however, getting stonewalled by the Committee doesn’t mean the issue goes away. It’ll usually bring forward the realisation that they have little option other than to take legal action.

Do Unit Owners have the right to lodge a Strata Insurance claim?

Do Unit Owners have the right to lodge a Strata Insurance claim?

Strata Insurance in Australia provides cover not only for common property but also for items owned by unit owners. Each state’s strata legislation defines a minimum of what is to be covered and all policies on the market will include this and then some.

Some unit owner items that are covered include kitchens, bathrooms, internal doors and walls, built-in cupboards, shelving and essentially anything else within a unit that is permanently attached to the structure. Some exclusions do apply however.

Council Funded Cladding Replacement – an elegant solution?

Council Funded Cladding Replacement – an elegant solution?

Owners Corporations that have identified their building contains flammable cladding, whether proactively or by Council inspection are placed in a tough predicament.

In most cases the cost to tear down this cladding and replace with non-flammable cladding is substantial so many schemes will consider two options:

1.       Accept the higher risk of fire spreading and take no action.

2.       Burden the scheme with significant debt and rectify the issue.