Strata Insurance Insights: Temporary Accommodation and Loss of Rent Benefits

We understand that navigating strata insurance policy wordings can often raise questions, and we have recently had several enquiries relating to Temporary Accommodation and Loss of Rent benefits during claim time. We’re here to provide some clarity on these common questions.

Temporary Accommodation and Loss of Rent are two separate benefits afforded under a strata insurance policy that apply to different occupancy types. Both benefits are afforded to the owner of the lot and apply in the event a lot becomes uninhabitable due to an insured property damage event.

Temporary Accommodation applies to owner-occupied lots and will cover the owner’s temporary accommodation cost until the repairs are completed.

Strata policies may also include an ‘emergency accommodation’ benefit, which allows affected owners to access suitable accommodation for a few days following an event until their claim can be assessed and entitlements confirmed.

Loss of Rent cover applies to tenant-occupied lots and will cover the period the owner is not able to charge rent. It provides financial protection in cases where rental income is lost due to the lot becoming uninhabitable.

A tenant that does not own the property is not afforded the temporary accommodation benefit under the strata plan’s insurance policy. Therefore, tenants are encouraged to have their own insurances in place.

Both benefits cannot be a standalone claim, damage must first occur that renders the lot uninhabitable, and the claim itself must be accepted under the policy.

Given the variations in policy wording among different insurers, you should review your insurer’s policy wording to gain a comprehensive understanding of how your specific policy would respond.

Key Takeaways

  • Temporary Accommodation applies to owner-occupied lots.
  • Loss of Rent applies to tenant occupied lots.
  • Tenants are not afforded these benefits.
  • A claim for property damage must be accepted under the strata insurance policy in order for the temporary accommodation/loss of rent benefit to apply.
  • Review your policy wording.

Should you require any further clarification or would like to discuss any policy questions please feel free to contact CRM Brokers.


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