Question: Our tier 4 owners corporation voted to insure each unit individually, but we can’t find an insurer. Does the new legislation allow this?
Our tier 4 owners corporation disagreed about whether to have flood insurance and resolved by vote to insure each unit individually. The owners corporation insures common areas and the driveway. We are having difficulty locating a strata insurer who will insure individual lots.
We are in a quadplex. Lots are attached via a firewall with common-use post boxes and bin storage, and all pipes go through a common main in unit 1. Are we considered single dwellings if the lots are not standalone? Does the new legislation allow us to continue insuring each unit as an individual home?
Answer: In a scheme with shared firewalls, the multiple single dwellings insurance provision does not apply. Full building insurance is required.
Amendments were made to the Owners Corporations Act 2006 (the Act) in 2021 which affect insurance. The Act notes that where there are multiple single dwellings, the owners corporation can resolve that each lot is responsible for the insurance of their lot.
However, strata insurers are not obliged to offer a product that is suitable for individual owners. Meaning not all strata insurers offer common area only policies. I am aware of only one strata insurer that offers policies for individual homes. Individual homes not covered by a strata insurance policy would normally be covered by a home insurance policy rather than strata insurance.
If the property has shared walls and roofs, we would not consider this a single dwelling. A single dwelling would be a standalone building with separate walls and roof. In this instance, provision 61A, which allows the owners corporation to resolve to insure individually, would not apply. Meaning section 59 is applicable, and the owners corporation is required to insure all buildings.
59 Reinstatement and replacement insurance
(1) An owners corporation must take out reinstatement and replacement insurance for all buildings on the common property in accordance with this Division.
Strata insurers will generally only offer a policy that covers all lots and common areas, or refuse to quote.
This post appears in the September 2026 edition of The VIC 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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