This article discusses burst flexi hose insurance by explaining who is responsible for damage from a burst hose in an apartment and what is covered under strata, contents, and liability insurance.
Question: Our strata manager has notified residents that any damage caused by flexi-hoses bursting is the responsibility of the resident. What insurance do residents need to ensure they are covered?
Our strata manager has notified residents that any case of flexi-hoses bursting is the responsibility of the resident and not strata in terms of damage caused to their and/or other apartments.
What insurance do residents need to ensure damage inadvertently caused by them is covered? Does water damage to carpets / flooring / gyprock fall under buildings or contents insurance?
Answer: In the case of flexi-hoses, the insurer will not cover costs associated with finding and fixing the burst hose, but water damage to the building can be considered.
Generally, strata insurance will cover damage to property insured by the policy, including water damage.
The basic principle is that if you pick the unit up and shake it anything that falls out is lot owners contents + temporary floorings such as carpet, blinds & curtains, appliances that are not permanently attached and paint & wallpaper (NSW) – these items are not covered by strata insurance and should be referred to the contents insurer to make a claim.
Strata insurers will cover the cost to repair water damage to insured property but generally exclude repairs cost related to finding and fixing the leak, as it is generally considered the owners responsibility to maintain their property and such repairs relate to general maintenance or wear and tear. The insurer has exclusions such as lack of maintenance, rust, oxidation, wear & tear, corrosion, gradual deterioration, developing flaws, building defects etc.
In the case of flexi-hoses the insurer will not cover costs associated with finding and fixing the burst hose (this will be the lot owners responsibility), but water damage to the building (insured property) can be considered.
Notwithstanding, insurers may apply an exclusion to flexi-hose claims if there has been a series of such claims. If there is an exclusion applicable to burst flexi-hoses in the policy, lot owners may be responsible for damage associated with the burst flexi-hose. The owner may also be responsible for any excesses associated with claims that originate from their unit.
It is not possible to insure property insured by strata insurance on any other policy – the strata policy should respond to damage to building/insured property. The only other insurance that can be considered is liability cover under a contents or landlords policy which covers legal claims against lot owners for damage to property they do not own (for example the apartment below you).
This post appears in the October 2021 edition of The NSW Strata Magazine.
Tyrone Shandiman
Strata Insurance Solutions
E: tshandiman@iaa.net.au
P: 1300 554 165
This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.
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