Question: Does short term letting affect our strata insurance policy?
A few owners in our building rent their apartments out on Airbnb. Owners are worried this will affect our strata insurance. Does short term letting change our policy cover or premium? Is there anything the committee can do to make sure we’re still fully protected?
Answer: Short-term letting is common in strata buildings and generally does not affect policy cover, but committees should keep their insurer informed.
Short-term letting is now a common feature in strata buildings, and insurers generally expect to see some level of it. From a disclosure perspective, you should make reasonable efforts to inform your insurer or broker of the number of lots used for short-term letting, so the risk is accurately represented.
Where it can have an impact is at higher levels of short-term use. Depending on the insurer, once a building reaches around 20% to 50% of lots being used this way, it may be classified as mixed-use or commercial. That can affect insurer appetite and pricing, rather than the scope of cover itself.
In terms of policy cover, we’re not aware of strata insurers applying exclusions specifically because a lot is used for short-term letting. We also haven’t seen claims declined on that basis. Insurers recognise that short-term accommodation is widespread and policies are generally structured with that in mind.
For committees, the practical step is to keep your insurer informed and ensure your policy reflects how the building is actually being used.
This post appears in the June 2026 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.
