Condominium insurance covers most water damage similar to home insurance. It covers water damage restoration for the damage caused by internal sources such as burst pipes, water leaks, and the like. For external sources such as floods you might get another type of insurance. However, you might be wondering if that would be covered under your strata insurance. In order to enlighten us, we will discuss the differences between condominium insurance and strata insurance. Afterwards, we will discuss how water damage can be covered by these two types of policies.
Strata insurance covers the building exterior and common property. Common property refers to the areas for the use of all the lot owners in the condominium, such as the stairwells, pathways, recreational facilities, and the like. Condominium insurance on the other hand, will cover your furniture and the upgrades that have been made on your condo since it was originally built. So what if water damages your walls, your carpets, and your floor? Which insurance covers what?
Water damage insurance coverage for this type of situation will depend on a number of factors. The first question you have to ask is: what was damaged? The second question is: is it your fault or not? The reason for you to ask these questions is because if it was your fault, then the water damage restoration will be charged to your condominium insurance if you have any. If not, then strata will charge costs to you personally. If it is not your fault, then water damage restoration will be charged to your insurance and then they will collect from the strata afterwards. In either case, you must have condo insurance first before you can have strata cover the restoration.
So if water damaged your walls, carpets and subfloor, and you were not at fault, which insurance would cover what? For the broken pipe, walls and subfloor, the condominium insurance will cover the restoration cost. Afterwards, the strata company will have an obligation to your insurance company to pay them for the costs of the restoration. For the new carpet that was installed after the original construction of your home, your condominium insurance alone will cover it. If you are at fault however, everything is covered by your condominium insurance. If you don’t have one, then the money will have to come out of your own pocket.
As you can see, having condominium insurance is better than just having strata insurance alone. Water damage restoration can be devastating to your property but having it insured gives you peace-of-mind that you are prepared come what may.