Block of Units Insurance

It depends on the percentage of vacancy. While standard "Unoccupancy Clauses" typically trigger after 60 to 90 days of total vacancy, a block of units is unique because it may be partially occupied.

- The 80/20 Rule: Some insurers may consider the building "occupied" if a certain percentage (e.g., 50%+) of units are tenanted.
- Renovation Risks: If units are vacant due to renovation, this alters the risk profile and requires a "Works in Progress" notation or a separate Construction policy.

Important: Always notify your broker if occupancy levels drop significantly. Failure to disclose this change in risk could prejudice a future claim.

No, standard building policies generally exclude malicious damage by tenants. A standard Block of Units policy covers the physical structure against events like fire, storm, and impact. It typically does not cover:

- Malicious Acts: A tenant smashing walls or doors.
- Rent Default: Loss of income if a tenant stops paying.

To be covered, you must arrange a policy that specifically includes Loss of Rent and Malicious Damage, or arrange separate Landlord Insurance policies for the individual units.

‍Broker Tip: We have access to specialised markets that bundle this together in one policy. For example, we work with an insurer that includes cover such as $70,000 contents as standard, simplifying the need for separate landlord policies.

Yes, but you need a specialised short-term rental policy. Most standard residential insurers exclude Airbnb and Stayz because they classify them as "business activities." However, we access specialised landlord insurers who explicitly cover short-term letting under a specific residential wording.

- Liability Exposure: The biggest risk is Public Liability. If a paying guest slips and falls in the stairwell, a standard home and contents policy will likely decline the claim. A specialised policy ensures this commercial-style liability is covered.
- Wear and Tear: Be aware that even specialised policies generally exclude "wear and tear" caused by high turnover, but they will cover malicious damage caused by guests.

You will require a special type of Commercial Property Insurance (mixed-use residential/commercial). Once a retail or commercial element is introduced (like a café or laundromat on the ground floor), the building can no longer be insured under a purely "Residential" policy.

- High-Risk Tenants: The type of tenant matters. A florist presents a lower risk than a takeaway shop using deep fryers (high fire load).
- Fire Ratings: Commercial tenants may trigger different fire safety compliance requirements for the whole building.

‍Expert Insight: Insurers assess "occupancy ratios" differently. For example, if a building has 200sqm of retail downstairs and 200sqm of residential upstairs, one insurer might accept it as a 50/50 split. However, another might decline it based on tenant count (e.g., two residential tenants vs. one commercial tenant), viewing it as too heavily weighted toward residential risks for their specific commercial appetite. We help navigate these complex underwriting criteria.