QLD: Treasurer refusing to renew strata insurance — what can lot owners do?

Question: Our treasurer refuses to renew the strata insurance, stating it’s not required. I thought everyone understood the need for insurance in strata, as well as the need to cover themselves as an office bearer. How should I approach this matter?

Answer: The adjudicator can make an enforceable order compelling the body corporate to take out the necessary insurance.

Under the Body Corporate and Community Management Act 1997 (QLD) and its accompanying regulations, it is a legal requirement that the body corporate hold insurance for:

1. Full replacement value of common property and building/s (if it is a building format plan of subdivision); and
2. Public liability insurance, with a minimum cover of $10 million for any one occurrence.

These obligations are not discretionary — the committee, including the treasurer, must act in accordance with the Act. A treasurer does not have the authority to unilaterally decide that insurance is “not required,” particularly when it is mandated by legislation.

Failing to insure places all lot owners, residents, and even the committee members themselves at significant financial and legal risk. Not only could this result in personal liability for committee members (particularly in the event of an incident), but it could also expose the body corporate to regulatory action and loss of protection in the event of a claim.

If the body corporate is not complying with its statutory insurance obligations, any lot owner has the right to lodge an application for adjudication with the Office of the Commissioner for Body Corporate and Community Management. The adjudicator can make an enforceable order compelling the body corporate to take out the necessary insurance.

Tyrone Shandiman
Strata Insurance Solutions
E: tshandiman@iaa.net.au
P: 07 3899 5129

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.