This article is about office bearers liability insurance in NSW strata schemes.
Table of Contents:
- QUESTION: As committee members, what are our potential personal liabilities if we know about major defects and don’t disclose this information to our insurer or take any action to repair it?
- QUESTION: Are there legal cases where office bearers liability insurance has been invoked?
Question: As committee members, what are our potential personal liabilities if we know about major defects and don’t disclose this information to our insurer or take any action to repair it?
Answer: We highly recommend not ignoring these matters because you will be responsible for decisions made by the insurer with regard to their decision/s in how they respond to a claim (in part, full, or denial), potential cancellation of a policy coverage and/or risk of placement of future cover by either the current or future insurers for past non-disclosures.
This may be getting into an insurance question, but we are all aware of the duty of disclosure. If you are aware of major defects, such as concrete cancer, even if the owners corporation is unable to meet the full repair costs immediately, you could put some temporary measures in place to prevent further damage or risk, such as spalling, from occurring.
We recommend consulting a professional for advice on mitigating safety risks, even if it’s a short-term solution. Stage two of the repair might involve a broader scope of fixing the problem, but we highly recommend not ignoring this matter because you will be liable.
Bruce McKenzie Sedgwick E: bruce.mckenzie@au.sedgwick.com P: 1300 735 720
This post appears in the August 2025 edition of The NSW Strata Magazine.
Question: Are there legal cases where office bearers liability insurance has been invoked?
Answer: Claims against office bearers are not frequent.
Office bearers benefit from protections under applicable state strata legislation, which often covers their actions performed in their official capacities. As a result, claims against office bearers are not frequent.
At Strata Insurance Solutions, the most common type of claim we’ve encountered involves allegations of defamation.
It’s important to note that many insurers specifically exclude defamation from coverage under their office bearers liability insurance.
This exclusion highlights the importance of carefully reviewing your policy to understand what is and isn’t covered.
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.
This post appears in Strata News #715.
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Read next:
- NAT: Q&A Public Liability Insurance in Australia
- QLD: Q&A Understanding Office Bearers Liability Insurance
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