Turning Point for Strata Insurance Premiums

Strata insurance premiums are showing early signs of stabilisation, offering some welcome relief for Owners Corporations after several years of significant increases. One of the key drivers behind this shift is increased competition, with more insurers entering or re-entering the market. As a result, well maintained and low risk properties are beginning to see premiums level out, and in some cases even reduce slightly.

Competition Returns

Despite this positive trend, it remains prudent for committees and Strata Managers to budget conservatively. Allowing for a 10-15% increase is still a sensible approach to ensure financial preparedness, particularly as pricing conditions can vary between insurers and regions. Even in a stabilising market, external factors such as claims activity and updating building valuations can still influence premium outcomes.

Signs of Improvement

It is important to note that not all properties are seeing the same improvements. Buildings classified as hard to place risks, such as those with higher claims histories, construction concerns, location exposure, or unfavourable commercial tenancies continue to face elevated premiums. This is largely due to the limited number of insurers willing to underwrite these risks, which reduces competition and pricing flexibility.

While the worst of the premium volatility appears to be easing, strata insurance is still a market that requires careful planning. Owners Corporations should take advantage of increased competition where possible, while remaining realistic about budgeting and risk factors.

A proactive approach, supported by expert guidance, will help ensure buildings are both adequately protected and positioned to benefit as conditions continue to improve.