Strata Insurance Claim Rejection: NSW

There was an incident of flooding at the unit that we currently rent (in NSW)
The agent's plumber cdnt find a fault in the plumbing line, so the tap might have been left open by my toddler and due to water service interruption we only realized it the next day and by then the unit and the common hallway was flooded. The Plan of the bathroom doesn't stop the flow of water.
Now, the Strata has been repairing, and the Strata Insurer has rejected the claim worth $20K.
we do not have a content insurance. But the Landlord has the Landlord insurance and we have confirmed that we would bear the excess for the same.
What are our options?


  • +1

    If the excess is more than your bond you could leave? But that would be a shitty thing to do if it was caused by your toddler and no fault in the system (was the drain in the bathroom blocked?)

    • Yeah. We did observe dust and could hv been rodents as well. We do not intend to leave the property. And Happy to pay the excess as well. But would the excess cover the common property as well?

      • I don't know, people with more experience will probably answer soon, but my guess is the responsibility falls on the landlord. It will be up to them to hassle the strata or get their own insurance to cover it. The reason landlord insurance exists is it is difficult to get tenants to be financially responsible for what they do to the property beyond their bond.

      • No, your landlords landlords insurance will not cover common property. He will only have contents insurance which will only cover non common property items inside their unit (this is usually everything except shower bases and pipes\electrics in roofs\walls used by multiple units).

        If the Strata's insurance providers has rejected the claim strata (read owners) will need to cover the cost of the repairs to common areas. They make seek to claim those costs from the owner of your unit and in turn he make seek damages from yourself.

        Rule #1 is never admit liability, if you've advised the real estate agent, your landlord or the strata your child may have turned the tap on youre stuffed should they try to recover the costs of damages

    • Even if they moved out they could still be sued for the damage cost above the bond,

      • They could but that's a difficult and expensive process. I imagine the landlord would prefer to get insurance to cover it if that's at all possible

        • It's not really, the landlord would get receipts and file a claim with NCAT, would only be a single day hearing without lawyers.

  • Ooh, this is a tough one.
    If it's not the fault of the Landlord's property, should the Landlord bear the brunt knowing strata fees will going up?

    • +1

      Also what tap was this that a toddler could reach?

      Most if not all taps bar the garden and bath taps are generally too high.

      • +1

        Yeah, does seem odd, unless the toddler is 8 years old. On top of this, no one noticed all the water overflowing into the rooms. Who was supervising the toddler???

        Doesn't make sense.

  • +1

    Does strata have proof it was the unit at fault?

    • The Plumbers report that they have says so.

      • Did they check your bathroom drain too?

      • +1

        Then I can see strata pass the bill to the landlord. Not sure how the landlord will handle it but they can either use their landlord insurance or the landlord passing it onto you. Not sure if the landlord insurance would cover faults of the tenant though.

  • +6

    The landlord insurance will only cover damage to the landlords property, any common property should be covered under the strata insurance or not depending on their policy but most should cover water damage.

    Importantly Landlord insurance is paid for and covers the landlord, not you. Even if you pay the excess, the insurance company might come after you for the costs they had to pay out.

    Won't help you now but you should always have contents insurance when renting as it provides legal liability cover for damage caused by you.

    • So, you intend to say that there is no way we can waive off the charges quoted by the Strata.

      • +6

        At the end of the day, someone has to pay for it and it is usually the person who is at fault.

        Any insurance held by others will simply cover it for the insured party; but the insurance company will go after who is at fault. Insurance saves the insured party from having to chase others.

        Only time that insurance does not go after someone is when it is the insured party is at fault - in that case, insurance company gets the excess and that is it.

        • wondering if it was by a toddler wouldn't the event be covered under accidental damage claim?

          • +1

            @feedchaser: The landlord may be covered for the costs. What that means is the landlord is not out of pocket and does not need to chase the at fault party themselves. The paid their premiums for the convenience.

            The insurance company may still decide to chase the at fault party to recover their costs.

            The tenant unfortunately did not have insurance; so could still be liable if the landlord's insurance company decides to pursue it.

          • @feedchaser: There wouldn't be any way to prove that it is the toddler and not anyone else in the tenant's family though

      • Probably not in this case, both the Owners corporation and landlord will want to fix the damage. They will either pay to fix it themselves and probably ask you to pay or file an insurance claim and the insurance company will probably ask you to pay whatever costs they pay out.

        If you had contents insurance you could file a claim and be covered under the legal liability provision but other than that I don't see what options you have unless the tap was faulty or the damage wasn't your fault for some other season.

  • Landlord insurance covers any damage inside the unit. Landlord will engage their insurer and the agent will suss whos at fault.

    Strata insurance will cover any damage in common property. Strata will engage their insurer and agent will suss whos at fault.

    The bill (two) then goes to person at fault.

  • +2

    Did you say the water sevrice was interrupted?Whose fault was that? The water board? It is not uncommon to turn a tap on when the service is off and forget to turn it back off, And there should be a drain in the bathroom for overflow. So its not your fault, if you get taken to court

    • +1

      Yes the Service was interrupted by Sydney Water. And we weren't aware of it. The Services were back in the morning.

      • +2

        That feels kind of unfair then that you're blamed. Imagine if there was a blackout and you got super punished for having any of the lights on when the power came back

  • +2

    I dont think we are getting the full story here…

    Was a drain blocked?

  • +1

    Wet areas like bathroom and laundry need a drain in the floor for overflow, my bathroom has one.

    • Maybe it depends on the age of the property? The house I live in doesn't have one but maybe there are different rules for apartments.

  • On what grounds did strata insurance reject your claim.

    We had a similar situation while we were on holiday. The hose in the kitchen burst while we were away, flooded the place, and caused extensive damage.

    The incapable building manager first informed us that strata insurance does not cover situations like this.

    Good of the bloke who came to remove the carpets (lesson learnt - it always pays when you get the right people for the job). He strongly suggested that it is an insurance claim and suggested we reach out to Strata and if not directly to the Strata insurers. If knocked back, he suggested us other options to pursue. Strata took it up with the insurers and had that sorted out.

    • This 100%
      Do not believe the Strata Manager - their job is to minimise claims on the Strata Owners including Insurance Claims
      Their first stance is always that tenant should pay and/or individual unit owner should pay
      A Strata is a collective - like a big partnership - and almost any bill for ddamage to common areas etc. should be a shared bill
      That shared bill can definitely be claimed
      It is your landlord who has the problem
      If I was her I would ask to see the insurance companies written response
      5 will get you 10 no formal claim has been lodged

  • +3

    Member Since
    19 hours ago

    Surprisingly somewhat a reasonable topic.

  • You seems to change stream mid sentence… so the water was interrupted, no water, but "someone" turned on a tap (where?) which, I presume, once the main water was turned on again, resulted in your unit being flooded.

    You only need to get a professional carpet cleaner in to dry out the carpets.

    ALL bathrooms are fitted with a floor drainage plug…. this is a wet area, and any leak from washing machine, overflown bath, etc, is quickly diverted down the drainage system.

    Where is this drainage system? If none, what not?

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