Insurance for dual occupancy in the ACT

[Francesco]

I think this issue fits in with legal and insurance coverage.

I have a property that is in a dual occupancy in Canberra, ie two separate detached houses on a sub-divided block of land, but sharing a common driveway with a slim nature strip adjacent to neighbour in the next block. Our houses are called unit 1 and unit 2.

I have taken out insurance with NRMA to cover house, cars, building and content and NRMA sales said that NRMA will cover renovation up to $50k as well as the common driveway.

Without consultation the owner of the other unit has taken out a GIO policy to cover both units 1 and 2. He claims that I should pay him half and his policy is the operational one. He claims that NRMA cannot cover houses in such situations - something about unit title and multi-unit dwelling. He has gone to the trouble of pursuing his point of view up the administrative structure of NRMA to its policy section and claimed someone agrees with his view.

I have previously checked with GIO, which advised that it does not cover renovation in residential property, which is undergoing in my property.

I have spoken to the neighbour of the other unit on three ocassions and on these occasions I have made the following points:

1. his insurance with GIO is unsuitable for my property as it does not cover renovation on my property

2. I have adequate insurance with NRMA for my needs

3. Our units are in an informal body corporate which has only responsibiity for the shared driveway and adjacent nature strip. It should not have responsibility for houses (and its insurance). At the moment, there is sharing of water bill but separate meter for electricity and rates. (I will seek to have separate metering of water to minimise future aggravation.)

At the last and third meeting, the neigbour was quite aggitated. Now, the neighbour has provided me contact phone numbers for people in GIO and NRMA who presumably agree with him and wants me to sort it out quickly, claiming that he has insured for both of us. He also claims that it is illegal to have two insurance covering the same things (2 houses and common driveway).

I think I need to distant from the issue somewhat and perhaps wiser heads in SS may help throw some light on the whole situation.

 

[Paul@PFI]

Without consultation the owner of the other unit has taken out a GIO policy to cover both units 1 and 2. .

So he wants to insure your property with consulting you. LOL. He applied for a policy that covers you ? What some sort of self appointed body corporate ?? Did he send you a strata levies notice...Funny. Maybe its a gift. Did he pay the premium too?. In the world of privacy I wonder who NRMA would discuss this issue with. They cant speak to him cause he doesn't own it. Why would they allow him to insure your property. You cant walk around insuring all your neighbours homes. Ask him to pay your rates too.

Refer your policy back to your insurer and the underwriter to ascertain its valid for a claim. Give the UW all the crap he has given you and they will know. That's a UW job. Dont worry about the people on sales they know jack. Ask to speak to the underwriting manager. Then put it to them in writing. You know all that duty of disclosure could hurt you if you don't. If they agree its a valid policy you could tell him to ggf.

 

[Francesco]

Thanks, Paul for commenting on this issue.

So he wants to insure your property with consulting you. LOL. He applied for a policy that covers you ? What some sort of self appointed body corporate ?? Did he send you a strata levies notice...Funny. Maybe its a gift. Did he pay the premium too?.


There is no body corporate, no strata levies, no sinking fund, etc in an informal arrangement between the 2 owners in the unit plan although it is a strata plan property. Yes, he paid the premium and now wants me to foot 50% of the cost.


In the world of privacy I wonder who NRMA would discuss this issue with. They cant speak to him cause he doesn't own it. Why would they allow him to insure your property. You cant walk around insuring all your neighbours homes. Ask him to pay your rates too.


It was GIO that insured him for the unit plan. He just assumed he has the authority to buy the insurance and demand reimbursement from me after the act.


Refer your policy back to your insurer and the underwriter to ascertain its valid for a claim. Give the UW all the crap he has given you and they will know. That's a UW job. Dont worry about the people on sales they know jack. Ask to speak to the underwriting manager. Then put it to them in writing. You know all that duty of disclosure could hurt you if you don't. If they agree its a valid policy you could tell him to ggf.


It was NRMA. They confirmed with me that even in a strata plan situation, the insurance is validly made with NRMA as my unit is detached and if the neighbour is OK with it. Apparently, the neighbour has been OK with taking out separate insurances for 14 years until a solicitor recently alarmed him about the lack of a building insurance certificate covering both detached properties.

In seems in the ACT, The Unit Titles (Management) Act 2011 applies to all strata plans regardless of the number of units in it. However, there is a proviso that unit plans with 4 or fewer units 'may by special resolution, exempt itself from the requirements of this Act as prescribed by regulation.' (section 3.1.18).

Perhaps, the two of us should avail ourselves of the exemption to simplify things that need to be done under the Act.

 

[SOP]

Unit Titles (Management) Act 2011 applies to all strata plans regardless of the number of units in it.

Did you read the section on Insurance?

Simple solution is to find an insurance company that will meet both your requirements and insure the buildings and common areas together.

 

[Francesco]

Did you read the section on Insurance?

Simple solution is to find an insurance company that will meet both your requirements and insure the buildings and common areas together.

Yes, I have read it and also the exemption section in the Act for units of 4 and fewer.

I do not like common insurance, although they have a valid place in big building complex of multi dwelling units.

The GIO insurance the neighbour still comes up with after 3 rejections from me, does not allow coverage for the current renovation in my 'unit' (detached house). There are other difficulties like ongoing liaison with neighbour for insurance payment, allocation of costs due to differences between units, such as sizes, features and usage. Mine has more ensuites and rooms and deck. His has a swimming pool and study. Plus individual difficulties, such as having to deal with an impatient neighbour who is belligerent at times - the stress of being beholden to someone else in more aspects of living!

NRMA insurance covers separate houses and also the common driveway, ie we can just take up separate coverage and be responsible for it with practically no impact on the others.

It seems the exemption section in the Act allows for unit title plans with 4 or fewer units to exempt themselves from copying the more onerous and costly processes prescribed for apartment blocks. This is the approach I am trying to explore: to cut out as much of the administrative framework as allows under the Act to meet the practical requirements of our situation - mainly physical access through the common driveway between 2 units.

 

[Francesco]

This is a follow up on what happens with this issue.

I inquired with a friend who used to work with Legal Aid who directed me to Conflict Resolution (a non profit organisation), which referred me to Legal Aid. So, I inquired with Legal Aid and attended an interview.

The solicitor at Legal Aid wrote a letter to my neighbour, mentioning that he was responsible for over-insuring without consultation and it was not necessary to insure my property as well. In short, the solicitor suggested that he downsize or cancel his insurance and to cease and desist from harassing me.

So far, so good, tenant has not come round to discuss the issue or written any note to seek a response in the way he wants ASAP!