Commercial Shopping Precinct, Five Tenancies

A body corporate managing a five-unit shopping centre in regional Queensland contacted us ahead of their renewal. The building had three owners, five tenants, and a straightforward risk profile. Apart from one tenancy.

One of the tenants was a tobacconist. The lease was ending and the tenant was vacating, but the timing coincided with the insurance renewal. The departing tenant was still listed on the tenancy schedule when the renewal process began.

The existing insurer had already renewed the policy, but at a steep cost. The premium had jumped from around $7,000 to over $11,000, and the excess had gone from $2,000 to $20,000, solely because of the tobacconist. That's when the body corporate started looking for alternatives.

Tobacconist tenancies are one of the hardest occupancy types in commercial strata. The fire risk profile, stock value, and regulatory exposure make most underwriters either decline outright or load premiums heavily.

We approached the market systematically, submitting the risk to more than ten insurers and underwriting agencies across mainstream strata, specialist commercial, and AR network channels.

Every single one declined. Some cited the tobacconist directly. Others flagged peripheral factors like bushfire exposure, restaurant tenancy, or building sum thresholds, but the tobacconist was the common thread. Referred submissions sat without response.

Rather than accepting the declines, we took a different approach. We worked with the body corporate to address the underlying risk. The tobacconist was given formal notice to vacate within two weeks. Once the departure was confirmed and documented, we re-approached the market with an updated tenancy schedule and supporting evidence.

The sheer volume of declines was the first challenge. More than ten insurers declined, including specialist strata and commercial underwriters. The body corporate was running out of time and options.

Standard strata underwriters assess risk at the point of policy inception. A tobacconist on the tenancy schedule at day one means the scheme is priced as if that tenant will be there for the full policy year. No insurer was willing to differentiate between a current tenant and one who was days from leaving.

The existing insurer's renewal terms (over $11,000 with a $20,000 excess) were the only fallback. That was a significant cost increase for a small body corporate with just three owners splitting the premium.

Once the tobacconist's departure was confirmed, we placed the scheme through a specialist underwriter via our AR network. The policy was structured to reflect the actual risk profile: a five-tenancy shopping centre without the high-risk occupancy.

The client remains an active Tank client, having renewed the policy in January 2026. What started as a near-unplaceable risk became a straightforward annual renewal once the tenancy issue was resolved.

This case shows two things. Commercial strata schemes with difficult tenancy mixes need a broker who will work the problem, not just submit and accept declines. And sometimes the solution isn't just finding the right insurer, but helping the body corporate address the underlying risk factor.