Geyser claims are probably the most common insurance question in sectional title schemes. They are also one of the easiest claims to misunderstand.
Trustees need to know how the policy treats geyser replacement, repair limits, excesses, resultant water damage and maintenance-related exclusions.
What is usually involved in a geyser claim?
A geyser claim may involve the geyser itself, the installation, plumbing work, the excess, and damage caused by escaping water. These may not all be treated the same way by the policy.
Limits and shortfalls
Some policies apply geyser limits or standard replacement limits. If the actual replacement cost is higher than the policy limit, the owner may be responsible for the shortfall, subject to the policy and scheme arrangements.
Who pays the excess?
In many cases, the owner connected to the geyser or affected section may be responsible for the geyser excess. The exact position depends on the policy, scheme rules and claim details.
Resultant water damage
If a burst geyser damages ceilings, cupboards, flooring or another section, there may be a separate resultant damage claim. Trustees should confirm whether a separate excess applies and what documents the insurer needs.
Maintenance vs insured event
Insurance is not a maintenance plan. If the issue is gradual deterioration, poor maintenance or excluded wear and tear, the insurer may not respond to all costs.
Trustee geyser claim checklist
- Confirm which section the geyser serves.
- Get photos of the geyser and damage.
- Get a plumber’s report and invoice or quote.
- Record the date and time of the incident.
- Check whether resultant water damage occurred.
- Confirm the applicable excess and limit.
- Communicate clearly with the affected owner.
Common questions
Does the body corporate policy always cover geysers?
No. Cover depends on the policy wording, limits, exclusions and the cause of loss.
Who pays if the geyser cost is above the policy limit?
The shortfall may fall to the owner or body corporate depending on the policy wording and scheme arrangements. It should be checked before commitments are made.
Can trustees approve a better geyser than the policy limit allows?
Trustees should be careful. If the owner chooses an upgrade, the additional cost may not be covered by the policy.