6-Unit Block, Inner-West Sydney

A property owner contacted us after struggling to get quotes online for their 6-unit block in Sydney's inner west. The property - a 1970s double brick building with six two-bedroom units - was generating around $2,400 per week in rent.

The owner had an existing policy with NRMA at $1.6 million building sum insured, but knew this was inadequate. After factoring in demolition costs, professional fees, and current construction prices, the realistic replacement cost was closer to $4-5 million.

The problem: every online insurance portal they tried capped building sum insured at $2 million. They couldn't even get a quote for the cover they actually needed.

There was another complication - the property presented as a freestanding house from the street, making it difficult to categorise correctly in online quote systems.

This is a common issue with blocks of units. Direct insurers and online portals are designed for standard residential properties. Once you exceed their sum insured thresholds or have an unusual property configuration, you're outside their automated systems.

We submitted to seven insurers and underwriting agencies:

• Allianz - Declined (due to sum insured)
• Hutch - Declined (due to sum insured)
• Castle Insurance - Declined (maximum 4 units/dwellings)
• Hollard - Declined (due to sum insured)
• SGUA - Quoted $14,792 (indicative, subject to property valuation)
• CGU - Quoted $12,551 (referred and approved)
• CHU Underwriting - Quoted $17,987 (referred and approved)

Four outright declines, three viable options. That's the difference broker market access makes.

The $4 million sum insured was the main barrier. Allianz, Hutch, and Hollard all declined on sum insured grounds. Castle caps at four units or dwellings, so six was outside their appetite.

The SGUA quote came with conditions: they needed a property valuation report less than two years old, plus evidence that some balcony cracking had been repaired. These are the kinds of underwriting questions that don't surface in online quote forms - they only emerge when a human underwriter reviews the submission.

CGU initially indicated a premium above $18,000, but after negotiation and providing additional property details, we secured approval at $12,551.

We presented the client with three competitive options at the full $4 million building sum insured - something they couldn't achieve through any direct channel.

The key insight here is about underinsurance. Many block owners are sitting on policies with inadequate sums insured because that's all they could get online. The real cost isn't the premium difference - it's the gap between what's covered and what it would actually cost to rebuild.

This case demonstrates why high-value blocks of units need broker placement. The automated systems aren't built for these properties.