Who Insures What: Cover for Owners, Landlords and Tenants

The policy you are paying for is not the policy that covers you

Every owner in a strata or community titled group contributes to the corporation's insurance through their levies. Because the premium appears on the levy notice, a good number of people assume it covers everything they own. It does not. The corporation's policy covers the building. Your belongings, your rent, your liability as a landlord and your liability as a tenant sit outside it, and each one needs a different answer.

This article deals with what individuals need. For what the corporation itself must hold, and how replacement valuations work, see our guide to body corporate insurance.

What the corporation covers

A strata corporation must keep all buildings and building improvements on the site insured to their full replacement value under section 30 of the Strata Titles Act 1988. Replacement value is the cost of a complete rebuild, including demolition, surveying, architectural and engineering work, not the market value of the units. The corporation must also carry liability cover. The Act sets a floor of five million dollars and the regulations lift it to ten million. Most corporations must additionally hold fidelity guarantee cover.

In a community scheme, section 103 of the Community Titles Act 1996 draws the line differently, and the difference matters a great deal to owners. Where the scheme is a strata division, with lots stacked one above another, the corporation insures the whole building. Where the scheme is a community plan, with houses side by side on separate lots, the corporation insures only the buildings and improvements on the common property. The house on your lot is yours to insure.

Within a strata building, the boundary between building and contents is not where most people expect. Kitchen cabinetry, tapware, benchtops and fixed air conditioning are generally treated as part of the insured building. Floor coverings, curtains and blinds, light fittings, free-standing appliances and everything you would take with you when you move are generally not. Policies vary, so the safe course is to read the schedule rather than assume the convention.

If you live in the unit you own

You need contents insurance. The corporation's building policy will rebuild the structure after a fire, but it will not replace your furniture, your clothes, your computer or the contents of the freezer, and it will not pay for you to live somewhere else while the rebuild happens. A contents policy does both, and most also carry a personal liability component covering claims arising from something that happens inside your unit.

Two further points are worth attention. If you have renovated, the improvement needs to have been declared to the corporation and reflected in the insured value. An undeclared improvement is, in practice, an uninsured one. And if a claim is made on the corporation's policy, someone has to meet the excess. In a community scheme, section 103 of the Community Titles Act puts any excess or shortfall from underinsurance on the corporation. The Strata Titles Act is silent on the point, so in a strata group the answer turns on the corporation's articles, its resolutions and the circumstances of the loss. It is a question worth settling in advance rather than in the middle of a claim.

If you own the unit and rent it out

You need landlord insurance, and it does more than a contents policy. A landlord policy typically covers the limited contents an investor actually owns, being carpets, blinds, light fittings and any supplied appliances, along with loss of rent, damage caused by a tenant beyond fair wear and tear, malicious damage, and your liability as a landlord. None of that sits within the corporation's building policy.

The exposure people underestimate is loss of rent. If the building is damaged and the unit is uninhabitable for six months, the corporation's policy funds the repair but pays you nothing for the rent you have not received. Your mortgage payments do not pause for the rebuild.

Two situations commonly void cover, so check the wording before you rely on it. Short-stay letting is excluded or separately rated under many landlord policies, and an unoccupied period beyond a stated number of consecutive days can suspend cover entirely. Both catch owners who assumed the policy travelled with the change in use.

If you are renting

Nothing the corporation holds and nothing your landlord holds covers your possessions. If the building burns, the corporation rebuilds it and your landlord recovers their loss of rent, and your belongings are simply gone. A renter's contents policy is inexpensive relative to what it protects, and it usually carries a liability component that responds if you cause damage to the property or injure someone in it.

Tenants should also know that the statutory right to inspect the corporation's insurance policies does not extend to them. Section 32 of the Strata Titles Act gives that right to unit holders, mortgagees and prospective purchasers, and section 108 of the Community Titles Act works similarly. If you want to know what the building policy covers, the request goes through your landlord or their agent.

If you own a lot in a community plan

This is where the most expensive misunderstandings happen. In a community plan where your house sits on your own lot, the corporation does not insure your house. You need full home building insurance in your own name, at full replacement cost, on top of contents.

There is a further obligation that catches owners in schemes with shared walls or shared structures. Where an easement under the Community Titles Act requires your building to provide support or shelter to another lot, section 106 requires you to insure that building for the full cost of replacement with new materials, including demolition, site clearance and architect's fees. You must give the corporation evidence of that insurance as soon as practicable, and again after any change to the policy terms. You must also give the same evidence to an owner, prospective owner or mortgagee who asks, within five business days. The maximum penalty for failing to insure is fifteen thousand dollars, and for failing to provide the evidence, five hundred dollars.

Where to buy it

Insurance for individual owners and tenants is bought either directly from an insurer or through a broker. A broker costs you nothing at the point of purchase, because they are paid by commission from the insurer, and for anything complicated, a mixed-use building, a heritage listing, a group with a claims history, the advice is usually worth having.

If the ownership structure of the organisation you buy from matters to you, it is worth knowing that some Australian insurers are member-owned rather than shareholder-owned. In a mutual or member-owned insurer, the policyholders are the members, and surpluses are returned to the membership or held in reserve rather than distributed to external shareholders. That is the same structural logic Acacia Collective is built on, and members who like the model in strata management often like it in insurance too. Whether a particular mutual offers competitive cover for your circumstances is a separate question from how it is owned, and one you should test on the policy wording and the price.

Acacia Collective does not name a preferred insurer, and there is a reason for that. We take no commissions and hold no referral arrangements with insurers. Naming one would mean either an undisclosed benefit flowing to us or a recommendation we are not licensed to make, and neither is compatible with how we work.

A note on the limits of this article

This is general information about legal obligations, not financial product advice. Acacia Collective does not hold an Australian Financial Services Licence and cannot advise you on which policy to buy, whether a product suits your circumstances, or how much cover you need. Read the product disclosure statement, and if the decision is significant, speak to a licensed insurance broker or adviser.

Legislative references are current as at 23 Jul 2026 and cover South Australian schemes only.

Get in touch

If you are unsure where the boundary sits between your cover and the corporation's, or you have found a gap and want it closed before it is tested, get in touch. Working out who insures what is a great deal cheaper before the claim than after it.