What does a commercial strata policy insure?

The insured property and insured parties are defined in the policy schedule and wording. A building policy may cover specified building property and common property as described by the insurer. The exact definition, valuation basis and any exclusions must be checked in the policy documents.

Common policy sections

• Building or property damage: responds to defined physical loss or damage caused by an insured event, subject to the terms, limits and exclusions.
• Legal liability: may respond to specified third-party injury or property damage claims for which an insured is legally liable, subject to the wording and limit.
• Catastrophe cover: the policy may treat certain events separately, with event definitions, sublimits or higher excesses. Flood cover and other weather events are not identical across products.
• Machinery breakdown: may cover sudden and unforeseen breakdown of defined machinery if the option is selected and the item falls within the wording.
• Business interruption: may be available for a defined insured interest following insured damage. The wording sets the trigger, indemnity period, waiting period and limit.
• Additional extensions: options can include fidelity, office bearers, voluntary workers, catastrophe-related expenses or other specified costs. Each extension has its own terms.

Limits, sublimits and excesses

The schedule shows the selected limits and excesses. Sublimits can apply to particular property, events, costs or extensions. An excess may differ by event or type of loss. These amounts can materially affect the amount payable for a claim.

Exclusions and conditions

Policies contain exclusions and conditions that restrict or qualify cover. The wording may address matters such as gradual deterioration, maintenance, unoccupied property, building work, security, notification and the information supplied to insurers. The terms vary. Read the actual wording and endorsements for the relevant policy.

Information used to obtain terms

Insurers commonly ask for information about construction, building age, occupancy, protection features, claims and insured values. The requested information depends on the property and insurer. Inaccurate or incomplete information can affect underwriting decisions and policy terms.

Questions about your policy

For a policy-specific enquiry, provide the schedule, wording and endorsements. We can explain the insurance terms presented and identify questions to raise with the insurer. Any claim decision is made by the insurer under the policy.