Changes to Insurance Owners Corporation Victoria

Changes to Insurance Owners Corporation Victoria

The owners corporation world is poised to change on 1 December 2021 with the adoption of amendments legislated in the “Owners Corporations and Other Acts Amendment Act 2021” (“Act”). The new legislation sees changes in a range of areas including the all-important realm of insurance. The introduction of the 5-tier system has created greater flexibility for owners corporations (“OC’s”).

A huge driver of these changes to insurance has been the use of combustible cladding on buildings. The use of aluminium polyethylene-core and expanded polystyrene panels has created inherent risk in the building industry in Australia as a whole. Many insurers are reluctant to offer policies that cover buildings which have installed this type of cladding due to their increased fire risk. Moreover, buildings that do have this type of combustible cladding will generally find their insurance will not cover for that risk. As a result, OC’s will require updated reinstatement and replacement insurance cover which will almost certainly increase premiums due to the added risk involved.

The major changes to insurance requirements pursuant to the Act are as follows:


  • Public liability insurance must be at least $20 million.
  • Greater flexibility by allowing lot owners to insure separately through unanimous resolution.
  • Limited OC’s to have the ability to insure separately.
  • Valuations for all but tier 5 OC’s are required ever 5 years.
  • Allowance for an OC to levy charges for new insurance premiums and excess charges.


These changes will mean OC’s will need to get on top of their insurance policies in the near future. Without a sound understanding of what the impacts of the new insurance changes are going to be on OC’s, there will be an increased risk of liability. Understanding the changes from the moment they come into effect will allow OC’s and in particular managers to adapt seamlessly to the new legislation. The mechanisms and functionality of an OC will be broadly impacted by these changes to insurance.

The December 2021 deadline is fast approaching. To avoid being caught out when the new changes arrive, OC’s and their managers should be well prepared.

We have a dedicated team solicitors focused on OC matters that can assist with all your OC needs.

Should you require assistance with your matter, please give us a call. Our contact details are:

Berrigan Doube Lawyers

Melbourne:        (03) 9600 2577

Sydney:             (02) 9251 6699

Brisbane:           (07) 3229 0707

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