2020 Autumn Forum Practical Solutions to Managing & Mitigating Strata Risk 1
Agenda • Introduction ❖ Speakers ❖ Housekeeping • Damien Leary, Head of Underwriting & Claims • Michael Turnbull, National Claims Manager • Questions • Wrap Up & Feedback The Strength of Experience So what can you expect today? Today’s forum has been created based on feedback from Strata Managers. You told us that you and your teams wanted to get back to discussing the essentials of insurance. SO today we’ll unpack insurance and claims solutions that can mitigate and assist in the management of Strata risk. 2
Presenters • Damien Leary, Head of Underwriting & Claims, Strata Community Insurance • Michael Turnbull, National Claims Manager, Strata Community Insurance The Strength of Experience 3
Importance of Strata Insurance • Insured Property Losses • How does the policy respond? • Liability to others • De-Risking • Where does the premium go? The Strength of Experience Our intention is to provide some insight to some of the key benefits of our product and it responds in the event of a major claim, some other key exposures that are relevant and also the impact of risk management and ultimately how this flows through and impacts premium ultimately. Insurance in this sector is a vital part of protecting the most important asset that people with invest their money during their life. It’s critical to have the best coverage in place but it’s also a statutory obligation to insure for full replacement costs. In the following presentation I will use a recent example of a major claim we have experienced and some of the key areas where the policy responded. I also want to outline one of the sections that does not receive as much consideration as the cover for the building and that is Liability to Others - This exposure can occur through injury to a third party or third party property and you may not know about for 2 or 3 years down the track & could be hundreds of thousands or even millions of dollars in a claims – but more on this later… Statutory obligation – varies by state – no choice but to insure for the full replacement value – and it’s most likely the most valuable asset and having the 4
property insured for the full replacement value is extremely important 4
South Coast Bushfires • 2008 Build • 3 Storey • Total Sum Insured - $16.6m • 13 lots, 9 Destroyed • $9 million claim The Strength of Experience We thought the best way to talk about what’s covered by the policy is to use a real life example and probably the most topical event of recent times have been the recent bushfires. SCI like many insurers have been impacted by these events so it’s the best example to use, The event occurred 6 th January on the South Coast of NSW Fires ripped through this part of the country (like many others ) with devastating effect. This event had a significant impact on the area, destroying 258,000 hectares and 6,500+ homes. Unfortunately one of our insureds were impacted by these extraordinary events. The complex we were covering was - 2008 build - 3 storey - 7m building um insured - 13, lots with 9 destroyed - The total claim to us was $9m 5
South Coast Fire Video Clip ABC News The Strength of Experience 6
South Coast Bushfires The Strength of Experience In Malua Bay, at least a dozen homes were wiped out by the fires and raging winds. As bushfire spread more than 1,000 people and their animals huddled on the beach for almost 24 hours, hemmed in by a ring of fire and the Pacific Ocean. 7
Protecting Your Most Important Asset • Bushfires and Property Damage/Loss. • SCI’s focus: – Make safe. – Engaging engineers – Repair & rebuilding – DA – Working with our panel of builders The Strength of Experience While the make-safe, demolition and quoting was being carried out we had act quickly to respond to emergency/temp accommodation for 2 owners that were impacted by these fires. How the policy responded in this instance - we advanced $3000 immediately to 2 owners, without the usual documentation because it was the primary residence, to enable them to get emergency accommodation. Any delay on our side would have put them under significant financial strain. They acted quickly on their own and were able to secure long term accommodation. Now that I have outlined the property that we are covering and the event that occurred, what I now want to outline how the policy responds and how we act as an insurer at the time of a catastrophic event. Following the notification of the event - we needed to respond quickly to ensure the occupants were accommodated elsewhere, demolition was done and we could commence with the initial So our initial approach was 8
Removal unstable structures, rubble etc Makessafe Engage engineers, tenders as quickly as possible Start construction as soon as possible Need to meet the statutory obligations to….. 8
How does SCI respond? Emergency Accommodation Emergency Accommodation Emergency Accommodation benefits are available with most Strata policies, however, Strata Community Insurance offers an exclusive benefit – emergency accommodation for tenants, where two or more units are unfit to be occupied, up to $1,500 per lot as a result of an admitted claim. Example: 1) Malua Bay: Advanced $3000 immediately to 2 owners. 2) A tenant fell asleep with a candle burning, causing a fire which spread to another unit. The building was evacuated and the tenants and owners were given a benefit of up to $1,500 per lot for alternative accommodation. The Strength of Experience Refer to Qld – Basement flooded. In this example, we advanced $3000 immediately to 2 owners, without the usual documentation because it was the primary residence, to enable them to get emergency accommodation. Any delay on our side would have put them under significant financial strain. They acted quickly on their own and were able to secure long term accommodation. The majority of other units were either holiday rentals and weekenders requiring no temporary accommodation. The two owners of the other full time owner occupied units were able to find accommodation with friends or family in the area and were happy to remain there while searching for permanent accommodation. In other scenarios it could be very different and that is where our policy would respond differently. Strata Manager/Bodies Corporate are open to negative PR when, in an emergency event, only Owner occupiers are financed for emergency accommodation. Tenants become the forgotten stakeholders! SCI’s Solution – We extend the $1,500 emergency accommodation benefit to tenants (leaseholder), to ensure emergency accommodation can be secured. 9
Strata Manager/Bodies Corporate are open to negative PR when, in an emergency event, only Owner occupiers are financed for emergency accommodation. Tenants become the forgotten stakeholders! SCI’s Solution – We extend the $1,500 emergency accommodation benefit to tenants (leaseholder), to ensure emergency accommodation can be secured. Example to point 1: - A fire in Queensland where the complex was without power for 8 days and 23 lots were tenanted, we allowed emergency accommodation for the first 3 days to all 23 tenants - A burst pipe in Victoria flooded 3 apartments, two were tenanted and we paid for the tenants first 2 nights accommodation costs - A hail claim in NSW in which 5 units were unliveable and 3 were tenanted, we paid for the tenants 2 nights emergency accommodation - This benefit saves owners, and Strata Managers from many phone calls from stressed out tenants and real estate agents 9
How does SCI respond? Temporary Accommodation • Primary residence – From the date of fire to completion of reconstruction. – Max 12 months where not rebuilt. • Part time occupation – Offered accommodation based on similar properties. The Strength of Experience With this particular claim, the exposure for us to pay temporary accommodation was limited due to the fact that the majority of other units were either holiday rentals and weekenders requiring no temporary accommodation. The two owners of the other full time owner occupied units were able to find accommodation with friends or family in the area and were happy to remain there while searching for permanent accommodation. However, there are plenty of other examples where temp accommodation can become a significant issue 10
Recommend
More recommend
