Who Pays the Excess in a Body Corporate Claim?

Start with the policy schedule

• The excess amount is normally listed in the schedule or policy endorsement.
• Different excesses may apply to geysers, water damage, storm damage, theft, power surge or liability claims.
• The highest excess is not always obvious unless the schedule is read carefully.

Then check the scheme’s rules and resolutions

• Some schemes have rules or AGM decisions dealing with excess recovery.
• Trustees should apply the process consistently and avoid making ad hoc decisions for each owner.
• Where there is uncertainty, trustees should get proper advice before recovering an excess from an owner.

Common scenarios

• A geyser in one section causes damage to that section or another section.
• A common property pipe causes damage inside a unit.
• A storm damages roofs or common property.
• A vehicle damages a gate, wall or common property structure.
• A liability claim is made by a visitor or third party.

How to prevent disputes

• Explain the excess before repairs are finalised where possible.
• Keep the policy schedule available to trustees and managing agents.
• Record the reason for the excess decision.
• Use clear owner communication templates for common claims.

Questions to ask your broker

• Which excess applies to this claim?
• Can the excess be recovered from anyone under the policy or scheme rules?
• Will repeated claims increase the excess at renewal?
• Should the scheme consider a different excess structure to reduce premium or disputes?

Frequently asked questions