Question: Our Owners Corporation Manager said we needed mechanical breakdown insurance in our policy to cover our garage doors. Is this correct?
Our Owners Corporation Manager said that we had to include mechanical breakdown insurance in our policy to cover garage doors. Each unit has one garage door for personal use. The Air conditioner is also personal use. We have no lifts as we are just a group of townhouses.
Answer: There isn’t a requirement to insure for breakdown.
There isn’t a requirement to insure for breakdown. I really recommend clients consider breakdown when they’ve got lifts, central air conditioning units, high cost, machinery around maintenance of a pool, so pool pumps and so on, and garage doors as well, but not necessarily for garage doors that simply service one lot.
You have to remember that breakdown covers just that. It covers the breakdown of that item. A breakdown is something that normally happens over time, and I guess, can be due to wear. It would be fair and reasonable that owners wear that expense as opposed to the Owners Corporation, insuring for those things.
That being said, it would fall to a decision of the committee as to whether they did or didn’t want to insure the garage doors for breakdown. Personally, if I was on the committee and that was the only breakdown item, I would probably see that we didn’t insure for breakdown if the expense didn’t justify it.
Some insurers will insure breakdown for $100. In that instance, I’d probably take the cover out, but then others might be $1,500 to $2,000 and you’d have to question whether the garage motor and the excess would make it worth claiming for that.
This post appears in the June 2021 edition of The VIC Strata Magazine.
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 Advisernet Australia AFSL No 240549, ABN 15 003 886 687.