Short answer
The owners corporation insures the building and common property, but not what is inside an individual lot. So owners should take out their own contents insurance for their belongings, internal improvements and personal liability, and investors usually add landlord insurance. Assuming the strata policy covers everything inside your unit is a common and costly mistake.
Where the strata policy stops
The scheme’s building insurance covers the structure and common property. It does not cover your furniture and belongings, your internal fit-out or improvements (carpets, blinds, a renovated kitchen), or your personal liability for something that happens inside your lot. That boundary is why individual owners still need their own cover — the two policies are meant to sit side by side.
What owner-occupiers should consider
An owner living in their unit typically takes out contents insurance for their possessions and internal improvements, and for personal liability within the lot. Some owners also insure upgrades they have made that the strata policy would not fully reinstate. It is worth checking where your improvements sit, so a claim doesn’t fall into the gap between the two policies.
What investors should consider
Owners renting their lot out usually add landlord insurance, which can cover loss of rent, damage caused by tenants and related liability — none of which the strata building policy addresses. This is separate from, and additional to, ordinary contents cover.
Making the boundary clear to owners
On a self-managed scheme, one of the committee’s quiet jobs is helping owners understand what the strata policy does and doesn’t cover, so nobody is caught out after an incident. A system such as Straita keeps the scheme’s policy details on hand and makes it easy to share what is and isn’t covered with owners — so the committee can point people to their own contents or landlord cover before a claim, not after.
Primary sources
- Strata Schemes Management Act 2015 (NSW) — the owners corporation’s building insurance duty (s 160), which does not extend to lot contents.
- NSW Government — Strata schemes (Fair Trading) — what strata insurance covers and owner responsibilities.