Addressing Rising Insurance Costs: ICA's Call for Strata Law Reforms in Victoria

In a submission to the Expert Panel Review of the Owners Corporations Act 2006, the ICA emphasised that building defects in residential apartments are costing Australians an estimated $1.3 billion annually. Many strata buildings are facing insurance affordability challenges or becoming uninsurable due to structural issues and inadequate risk management.

The ICA's submission draws upon its 2024 report, "Improving Consumer Outcomes for Strata Communities," and calls for several key reforms to Victoria's strata laws, including:

• Stronger governance and education: Enhanced transparency and accountability within owners corporations to ensure better management and maintenance of strata complexes.
• Improved maintenance planning: Mandating regular maintenance schedules and adequate funding to address building defects and prevent deferred maintenance.
• Risk management strategies: Implementing comprehensive risk management plans to mitigate potential hazards and reduce insurance claims.

The ICA warns that without these reforms, poor governance and deferred maintenance will continue to transform insurable buildings into high-risk liabilities, driving up premiums for the one in five Victorians living in strata-titled properties.