This article discusses if duplex owners in a three-lot NSW strata can have separate insurance.
Question: Can duplex owners take out separate insurance if they share no common property with another house on the same strata plan?
I own one side of a duplex that shares a common driveway and wall with the adjoining lot. A detached house that does not share any common property with us sits at the front of the block, although all three lots are listed on the same strata plan and currently share one insurance policy.
Can the duplex owners take out separate insurance on the house, given there is no shared property? If both duplex owners agree, can we also insure our two lots separately, or must we continue under a shared strata insurance policy?
Answer: You cannot separate the insurance for the duplex from the detached house under the current strata plan.
Under section 160 of the Act, the owners corporation is legally required to insure the building(s) in the strata scheme. This obligation applies to all buildings on the strata plan — including your duplex and the detached house — regardless of whether you share common property with the other lots.
The only exception to this is for two-lot strata schemes with physically detached buildings, where owners can unanimously agree to arrange their own insurance. Because your scheme has three lots, that exception does not apply.
In addition, because the two duplex lots share a common wall and common property (driveway), they form part of the same building structure. They cannot be insured separately from each other without breaching the statutory insurance requirement.
In short:
- You cannot separate the insurance for the duplex from the detached house under the current strata plan.
- The two duplex owners cannot individually insure their lots in place of the owners corporation’s insurance, even if both agree.
- To achieve separate insurance, the strata plan itself would need to be legally restructured.
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.
This post appears in Strata News #765.
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Read next:
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