This article discusses strata bushfire prone building material compliance and how it affects insurance and owners corporation decisions.
Question: Our strata plan is in a bushfire prone area. Should we consider the appropriateness of our building materials?
Given that our strata plan is in a bushfire prone area, this prompts considerations about the BAL rating and the necessary repairs for the common property. It also raises questions about appropriate materials and who should oversee these matters. Should the control rest with the strata manager, the committee, individual lot owners, or perhaps a collaborative effort involving all three parties?
Answer: Failure to comply can expose owners corporations to liabilities associated with non-compliance.
Compliance with relevant building and fire codes is a paramount consideration for any strata building, as failure to comply can expose owners corporations to liabilities associated with non-compliance.
From an insurance perspective, insurers rate more favourably on buildings with 100% non-combustible materials. The most favourable ratings are for properties with brick or concrete external walls. Insurers also rate based on the property’s location, including proximity to bushland, and will consider fire safety and risk engineering factors.
In cases where neither the insurer nor local authorities require a change in materials, the decision to upgrade building materials to reduce the property’s risk rating falls to the owners corporation. This proactive step can potentially enhance the property’s insurability by improving its risk rating. Nonetheless, such a decision requires careful consideration and consultation, ideally with a qualified insurance broker.
Before embarking on any material upgrade project, seeking advice from an insurance adviser to understand the benefit to the owners corporation is highly advisable.
This post appears in the November 2023 edition of The WA 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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