Can lot owners arrange their own lot insurance in strata schemes?

In Western Australia, individual lot owners cannot generally arrange their own building insurance separately, as this approach is not permitted under the requirements of the Strata Titles Act 1985 (WA).

Specifically, section 97 of the Act requires that the strata company must insure all insurable assets of the scheme for their full replacement value. Importantly, this obligation is not limited to common property. It extends to the buildings as a whole, including improvements within individual lots (such as kitchens, bathrooms, and built-in fixtures).

As a result, the legislation effectively mandates a single, strata-held building insurance policy, rather than allowing individual owners to insure their lots separately. Splitting insurance as you’ve suggested would typically leave the strata company non-compliant with its statutory obligations.

There are limited exceptions, most commonly in survey strata schemes, where there are no shared buildings. However, for most built strata schemes, the requirement under Section 97 remains that the strata company must insure the building in its entirety.

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 and the specific coverage afforded under their policy wording. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisernet Australia AFSL No 240549, ABN 15 003 886 687.