Introduction

Rule number one for strata and body corporations: make sure your building is insured. But what does a corporation do when it can’t get building insurance because of a deteriorating asbestos roof? For one seven-unit body corporation in Adelaide, positive word of mouth led the committee to Whittles in August 2023 where experienced Strata Manager Anna Schirillo thought outside the box to find a creative solution to this high-risk situation. Anna’s actions resulted in the corporation switching strata management companies to Whittles, the corporation securing the insurance it needed and the building getting a brand-new roof. Here’s how Whittles worked with the body corporate committee and the insurer to help make the impossible possible.

Problem

The corporation’s key challenge was finding an insurance company prepared to cover the building because of the risks associated with its compromised asbestos roof. The committee asked its strata management company at the time to source insurance quotes but it didn’t supply any and communication was poor. The strata management company’s lack of urgency and inadequate risk response meant the building’s cover lapsed in April 2023 and the property was uninsured for approximately six months. If the worst happened and there’d been a fire or natural disaster during that time, there would be no insurance payout to replace the building. The owners would’ve had to fund the full replacement cost themselves. The corporation desperately needed help and was referred to Whittles where the group was assigned to skilled Strata Manager Anna Schirillo.

See our related blog: Is your strata committee/body corporate underinsured?

Approach

Whittles employees are taught to always mitigate risk for our clients so the corporation needed to know the hazardous situation it was in. Anna contacted the committee’s presiding officer and stressed how its uninsured building was putting the body corporate at high-risk. An urgent owners meeting was arranged where Anna explained our position: Whittles wouldn’t take over strata management of the corporation unless the building was insured and we had evidence the certificate of insurance had been paid. The owners knew insurance was a must. We knew outside the box thinking was needed on our part to arrange it. Whittles helped the owners open a bank account for the corporation where they could deposit money to pay for the insurance and replacement roof.

The next step was to find an insurer willing to provide cover for the building so Anna approached MGA Insurance brokers for a quote. CHU Insurance Company provided an estimate on the proviso Whittles supplied the insurance company with evidence the corporation had enough money in the bank account to pay for its cover and a new roof. CHU also wanted to see proof from Whittles that the body corporate had accepted the roofing company’s quote to replace the asbestos roof to show the work was going to happen.

Challenges

A key challenge was consulting with stakeholders and keeping them updated on progress. These stakeholders included the body corporate committee, owners, the insurance broker, the insurance provider and the roofing company. From a communication and resource perspective, it was an intensive process. 277 emails were sent between 24 August 2023 and 25 October 2023. This wasn’t a simple case of having an insurance company provide terms for a body corporate committee to accept. We were in constant liaison with our broker and a senior CHU representative who had to approve the insurance contract before it could proceed. It took a lot of hard work on Anna’s behalf. She remained committed to achieving a good result – and she did.

The quality of the existing roof timbers was another challenge that had to be overcome. The roofing company found issues with some of the timbers which meant more work was needed to fix them – and more money needed to be raised. Anna called an on-site meeting with the owners where it was agreed a levy would be raised to fund the timber repairs.

Results

Whittles went above and beyond with a creative and bespoke solution to help the corporation achieve what it needed through regular communication and site visits. Firstly, we found the corporation an insurance company who was prepared to provide cover and give the owners peace of mind. Secondly, Whittles gained a new client in January 2024 because Anna drew on her 12 years of strata management experience to solve the corporation’s highly complex insurance problem. A problem which its previous strata management company had neglected to fix. Finally, we arranged for the old original 1960s asbestos roof to be replaced with a new, modern iron roof in February 2024. The aesthetics of the property has now improved, and the body corporate is in talks with Whittles about further property improvements including tree pruning, painting and the installation of a new brush fence.

Key takeaways

The number one lesson for body corporates is to have building insurance in place. If your corporation is having trouble securing insurance for your building, do not ignore the problem. Follow up with your strata management company about quotes and be relentless. Consider alternative strata management if you’re not getting the results from your current provider. Do not let your building insurance lapse. The risks are too great if there’s a fire or natural disaster and your building is uninsured.

One of Whittles’ key priorities is to mitigate risk for our clients. One way we do this is by investing in training for our strata managers as well as body corporate committees. We organise free information nights where body corporate committees can come together and hear strata management experts speak on a range of different topics. These group events help committees stay up to date with the latest industry developments and share their experiences with other committees.

See our related blog: Client stability and serviceability central to Whittles’ management training

Interested in changing strata management companies? Contact your local Whittles branch today and request a quote.

Follow Whittles Body Corporate Management on LinkedIn and Facebook for more body corporate news and updates. You can also visit our Resources page for handy strata management tips.

Updated: 30 May 2024