Body Corporate Insurance
Mandatory unit title building insurance covering common structures, shared areas, and public liability.
Mandatory Under the Unit Titles Act
All body corporates must maintain insurance covering the common property including the building structure, shared areas, and public liability. This is a legal requirement, not optional.
The body corporate secretary or manager is responsible for arranging and maintaining this insurance.
Why Body Corporate Insurance Matters
Unit Titles Act Requirement
New Zealand law requires all unit title buildings to have insurance covering the common property. The body corporate must maintain this insurance.
Shared Structure Protection
Body corporate insurance covers common areas like hallways, external walls, roofs, parking areas, and shared infrastructure that benefit all unit owners.
Coordinated Claims
A single policy ensures consistency across all units. Claims are managed centrally, simplifying the process for all unit owners.
Full Replacement Guarantee
Body corporate insurance typically includes full replacement cover, meaning rebuilding costs are covered even if exceeding the sum insured (agreed value basis).
Who Covers What? Unit Owner vs. Body Corporate
Unit Owner Responsibility
- Buildings insurance for their individual unit (walls inward for most policies)
- Contents insurance for furniture and personal items
- Landlord insurance if renting the unit
- Any damage caused by their own negligence within their unit
Body Corporate Responsibility
- Common area buildings insurance (walls outward)
- Public liability insurance for third-party injury claims
- Professional management of insurance and claims
- Regular building inspections and maintenance
- Weathertightness issues affecting the whole building
Coverage Responsibility Chart
| Coverage Item | Unit Owner | Body Corporate |
|---|---|---|
| Building structure (walls, roof, foundation) | ||
| Common areas (hallways, foyers, lifts) | — | |
| Shared parking areas and garages | — | |
| External walls and weathertightness | — | |
| Roof structure and coverings | — | |
| Communal gardens and landscaping | — | |
| Lifts and common service areas | — | |
| Individual unit interior | — | |
| Individual unit fixtures and fittings | — | |
| Individual unit contents and furniture | — | |
| Damage caused by individual owner negligence | — | |
| Public liability (third-party injury) | — |
Coverage by Building Type
Small apartment complex (up to 10 units)
Standard buildings + public liability
Annual Premium (Est.)
$2,000–$4,000/yr
Note: Often consolidated with landlord policies if owner-occupied. Simpler claims.
Medium apartment building (11–30 units)
Buildings + public liability + infrastructure
Annual Premium (Est.)
$4,000–$8,000/yr
Note: Requires detailed unit count and building specs. Shared services require consideration.
Large apartment building (30+ units)
Comprehensive buildings + public liability + professional claims management
Annual Premium (Est.)
$8,000–$20,000+/yr
Note: Specialist policies available. Consider specialist body corporate insurers.
Mixed-use building (retail + residential)
Commercial + residential buildings + public liability
Annual Premium (Est.)
$10,000–$25,000+/yr
Note: Requires specialist underwriting. Commercial areas may need separate coverage.
Material Damage & Public Liability Requirements
Material Damage Coverage
Protects the building structure from accidental damage, fire, weather events, vandalism, and theft. Essential for all buildings.
MandatoryPublic Liability Coverage
Protects against claims if a visitor or member of public is injured on the common property. Often required by lenders and Unit Titles Act.
MandatoryOwners Liability
Extends liability cover to individual unit owners for damage they cause to common areas. Recommended addition.
RecommendedProfessional Indemnity
Covers claims against the body corporate for management decisions or professional advice. Recommended for larger buildings.
RecommendedManaging Body Corporate Claims
Report to Body Corporate
Notify the body corporate committee or manager immediately of any damage affecting common property.
Body Corporate Lodges Claim
The body corporate manager contacts the insurer and lodges the claim with supporting documentation.
Insurer Inspection
Loss assessor inspects damage and prepares a repair cost estimate. Unit owners may need to provide access.
Claim Settlement Decision
Insurer approves settlement amount. If dispute exists, the body corporate may need to dispute with insurer.
Repairs & Reinstatement
Body corporate arranges repairs using approved contractors. Timeline depends on damage severity.
Settlement to Body Corporate
Insurer pays claim settlement. Body corporate distributes costs among affected unit owners if applicable.
Important for Body Corporate Managers
Maintain detailed records of all claims, inspections, and communications with insurers. This protects the body corporate and supports future insurance applications.
Common Claims Examples
| Scenario | Who's Responsible? | Coverage Type |
|---|---|---|
| Roof leak damages common ceiling | Body Corporate | Buildings + public liability |
| Unit owner causes water damage to shared wall | Body Corporate (via Owners Liability if available) | Buildings insurance or Owners Liability add-on |
| Fire in common area causes damage | Body Corporate | Buildings + public liability |
| Visitor injured in common area | Body Corporate | Public Liability |
| Structural issues affecting multiple units | Body Corporate | Buildings insurance (may require structural assessment) |
Key Considerations for Body Corporates
Regular Building Inspections
Conduct annual inspections to identify structural issues early. This helps with claims and ensures adequate insurance coverage.
Unit Count Accuracy
Ensure accurate unit count and detailed building specifications when applying for insurance. This prevents coverage gaps.
Weathertightness Issues
For older buildings, weathertightness can be a problem. Ensure your policy covers this and consider specialist assessments.
Sum Insured vs Replacement Cost
Get a professional valuation of replacement cost for your building. Most policies use agreed value, but confirm replacement guarantee clause.
Levy Communications
Keep unit owners informed about insurance arrangements. If a claim occurs, explain how insurance will cover costs.
Claims Management Process
Develop a clear process for reporting and managing claims. Delegate to a secretary or manager who understands the policy.
Ensure Your Body Corporate is Protected
Get a quote for comprehensive body corporate buildings insurance. Mandatory protection for all unit title buildings.
Request a Body Corporate QuoteRelated Resources
Individual Unit Owner Insurance
Buildings insurance for your individual unit (walls inward).
Landlord Insurance
Insurance for landlords renting out unit title units.
Compare Providers
Compare body corporate insurance providers side-by-side.
Unit Titles Act Information
Official government guidance on Unit Titles Act requirements.
Get a Quote
Instant quote for body corporate buildings insurance.
Key Facts
- Mandatory by Unit Titles Act
- Covers common property only
- Public liability included
- Full replacement basis available
- Managed by body corporate
For Individual Unit Owners
You still need your own buildings insurance for your individual unit (walls inward). Body corporate insurance only covers common areas.
Learn about unit owner insurance →Body Corporate Secretary
If you manage a body corporate, ensure your insurance meets Unit Titles Act requirements and is reviewed annually.
Get professional advice →Expert Support
Our specialists understand body corporate requirements and Unit Titles Act obligations.
Contact Us