Home Insurance for Townhouses

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What is a townhouse?

What insurance do I need for my townhouse?

What is strata insurance?

Do I still need contents insurance?

What if I’m renovating my townhouse?

Does strata insurance cover landlords?

Is building insurance under strata mandatory?

How can I make a claim for my townhouse via strata?

Compare townhouse insurance today

Long story short

Townhouses mix private ownership with shared spaces

You own your home but share land, gardens, and driveways with neighbours in your strata complex.

Strata insurance is usually included in your owners corp fees

You and the other owners pay strata insurance to cover the building, common areas, and public liability.

Contents insurance is your own responsibility

You can protect your favourite things, like your TV or coffee machine, with a contents insurance policy.

Landlords need tailored coverage

If you’re renting out your townhouse, landlord insurance covers tenant dramas, like property damage.

What is a townhouse?

A townhouse is usually a multi-level home that’s part of a shared complex. You own your home but share the land and communal spaces like gardens or driveways with the neighbours.   

If you own a townhouse, chances are you’ve got a strata title (or scheme). Sounds fancy, but it just means you own your townhouse while sharing ownership of communal areas like driveways, gardens, or maybe even a pool with the other folks in the complex. 

Owning a strata property also makes you part of an owners’ corporation (or body corporate) – another fancy way of saying you and the other owners work together to manage the shared parts (and costs) of the property. 

The key thing to remember here is that in a strata setup, insurance works a little differently than it does when not you’re not living in a shared complex. 

What insurance do I need for my townhouse?

For most standalone homes, there are three main options when it comes to taking out home insurance: building insurance, contents insurance, or a combined home and contents policy. For townhouses, though, things get a bit trickier because you own a property as part of a bigger structure.  

You won’t find a product called ‘townhouse insurance’ – let’s start with that. Instead, your coverage could be a mix of strata insurance, contents insurance, and potentially landlord insurance if you’re renting your townhouse out. 

What is strata insurance?

Strata insurance is essentially building insurance but for a shared complex rather than a stand-alone home.  

Strata insurance is a group insurance is organised and paid for by all the homeowners in your complex via your owners’ corporation or body corporate. Everyone chips in through the strata levy (or body corporate fees). Strata levies don’t just cover insurance. It can also go towards things like keeping the pool looking mint, tidying up the gardens, fixing that flickering light in the stairwell, and making sure the communal spaces are in tip-top shape. 

Strata insurance doesn’t just cover townhouses. It covers any type of shared property covered under a strata scheme, such as an apartment building, a block of flats or a set of units.

Fixtures and fittings inside your townhouse (like taps, showers, or light fittings) can sometimes be a bit of a grey area so don’t assume they’ll be covered by your strata.  Take a careful look at both your strata and contents insurance to make sure they are adequately covered.   

Do I still need contents insurance?

Yes… at least if you want to cover all the bases!  

Strata insurance has your townhouse’s walls, roof, and shared pools covered, but insuring the belongings inside those walls is your own responsibility. Contents insurance ensures all those items that make your house a home – from your TV to your favourite coffee machine – are protected against things like theft, fire, and water damage. 

What if I’m renovating my townhouse?

Sprucing up your space? Planning to upgrade your townhouse with things like a designer bathroom or heated flooring? You’ll need to check your existing cover first.   

Taking out additional renovation insurance can be a bit tricky (and many insurers only cover legal liability, not the actual construction and rebuilding works) so it’s always worth checking your current coverage. 

Does strata insurance cover landlords?

For landlords, it’s a different ball game. Strata insurance will still take care of insuring the actual building even if you’re renting it out but you might also want to explore landlord insurance. It’s a tailored cover that protects you from tenant-related dramas, like:

Basically, landlord insurance cushions you against the risks that come with leasing out your property. 

Helpful tip

If you own a townhouse, you might want to consider adding building insurance to cover areas not included in strata, like your backyard or private fixtures, and contents insurance to add another layer of protection for your prized possessions.  

And if you’re renting out your townhouse, getting landlord options can help protect the investment property you worked so hard for while being the legend of a landlord you are for your tenants. 

Pairing these with your body corp’s strata insurance can give you peace of mind, knowing you’re covered for any surprises outside the shared spaces.

Adrian Bennett

General Manager for General Insurance

Is building insurance under strata mandatory?

Yes, it sure is. Every strata property by law must have an insurance policy in place (and the laws vary by state). This makes sense since all owners are collectively responsible for maintaining and repairing shared structures and spaces. Without this, repairs could become a logistical and financial nightmare (imagine the body corporate meeting dramas!) 

The owners’ corporation will typically arrange and renew building insurance as part of their responsibilities. Insurance will often be on the agenda for discussion at the owners corp’s annual general meeting.  

There’s no need to shop around for strata insurance yourself unless you’re one of the bigwigs on the committee and helping to make the big calls on behalf of the rest of the complex. 

How can I make a claim for my townhouse via strata?

Here’s how you can make a strata insurance claim: 

Know who’s responsible

Figuring out what’s covered by your body corp’s strata insurance and what’s on you is a good place to start. Strata usually takes care of the building and shared spaces, but damage to your personal stuff or any fancy upgrades would need to be covered under your own insurance. 

Assuming the damage falls under strata insurance:

Check the policy

Have a squiz at the complex’s strata insurance policy (you can ask your body corporate for a copy). Claims can fall under different sections like public liability or legal defence expenses. Every policy’s a bit different, so it’s worth knowing what’s what.

Figure out who’s at fault

If someone else caused the damage, you’ve got options: 

• Lodge a claim under the right policy (strata or your own contents insurance). The insurer might chase the responsible party for costs, but they won’t go after other lot owners in the same strata.
• Or, send a letter of demand to the person responsible and ask them to cough up or claim on their own insurance. 

Lodge your claim

Let your strata manager or body corporate know about the damage. As with any insurance claims, it’s worth backing it up with photos, videos, and all the details. If a few units are affected, you can consider bundling it into one claim to potentially save on excess.

Call in the experts if needed

If there’s any drama or confusion about the damage, the body corporate can ask for an assessor to come out and check things over. Their job is to make sure the insurer gets the full story.

Keep tabs on it

The story doesn’t end with filing the claim. Stay in touch with your strata manager or insurer to keep the claim moving and sort out any extra bits they might need.

Compare townhouse insurance today

Having an appropriate level of strata insurance means sleeping easier, knowing that you’re safeguarded whether you’re brewing up your morning coffee or there’s trouble brewing in the shared garden. 

Whether you want to complement your strata insurance with your own contents insurance, or avoid dramas while renting out your townhouse with landlord insurance, you can easily start comparing a range of home insurance options with the iSelect comparison tool.