Strata Insurance Market Begins to Stabilise After Period of Volatility

The recent 'hard market' cycle-characterised by premium hikes, reduced competition, and stricter underwriting-appears to have largely achieved its purpose. For many insurers, premium adequacy has now been restored. As a result, we are seeing the first signs of moderation:

• Premium increases are flattening, particularly for well-maintained buildings with clean claims histories.
• Insurer competition is slowly returning, offering more choice for buildings that present well to the market.
• Premiums are aligning more closely with inflation and valuation updates, rather than arbitrary market surges.

Today's insurance environment rewards preparation. Schemes that maintain accurate valuations, address known defects, and present well-documented maintenance records are far more likely to attract favourable terms. Key risk factors insurers are actively evaluating include:

• Recent claims history
• Outstanding defects (including waterproofing or fire safety)
• Presence of combustible materials (e.g., ACP, EPS)
• Age of infrastructure
• High-risk commercial tenancies
• Building sum insured over $50 million

For higher-risk buildings, insurer caution remains high. These schemes may still face limited capacity, increased excesses, or no quotes at all, especially in the case of large, complex assets.

Strata committees are encouraged to engage early with their brokers, maintain comprehensive maintenance records, and address any known issues promptly. By doing so, they can position their properties favourably in the eyes of insurers, leading to more competitive premiums and better coverage options.