Along with homeowners, strata managers should also be aware of rising inflation and check when their building sum was last updated. If it has been more than 12 months, it’s strongly recommended to obtain a new valuation.
Next, strata owners need to look at what level of indexing applies to the sum insured on the renewal, to ensure they are not falling behind in their insurance.
It’s also important to note that the cost of construction has risen roughly 18% over the past 18 months, which is significantly outpacing the rise in CPI, which has only gone up to about 5%.
“If you manage a strata then you need to make sure you’re covered for full replacement and reinstatement value, as well as any removal costs and professional fees,” says Jody.
“The price of these rising construction costs needs to be taken into account when reassessing your insurance policy.”
