Property guidance by Quay Law
Property guidance by Quay Law
Unit title guidance from Quay Law
Ian Mellett, Barrister and Solicitor, Quay Law
In a unit title development, the body corporate insures the buildings. That arrangement protects every owner, but it also means your cover depends on decisions made collectively. Understanding the policy is an important part of buying a unit title.
Under the Unit Titles Act 2010, the body corporate must insure the buildings and other improvements in the development. The policy is generally required to cover full replacement value, where reasonably practicable, and the premium is paid from the operating account through levies.
Information about the body corporate insurance forms part of the disclosure provided to buyers.
The body corporate policy covers the building, not your belongings. As an owner, you will generally need:
We recommend checking with your insurer what the body corporate policy covers so that there are no gaps.
Every policy carries an excess, and in some buildings it is substantial, particularly for natural disaster or weathertightness related claims. How the excess is shared depends on the circumstances of the claim and any relevant body corporate decisions or rules. A large excess can lead to a special levy.
Your lender will require confirmation that the building is insured before it advances funds. Your lawyer usually obtains a certificate of insurance from the body corporate manager before settlement.
How building condition affects every unit title owner, what disclosure does and does not tell you, and which reports to obtain before you buy.
How lenders approach unit title apartments and townhouses, what can affect lending, and how to protect yourself with the right finance condition.
How body corporate levies are set in New Zealand, what the operating, maintenance and contingency funds are for, and how special levies work.
We review the body corporate insurance as part of every unit title purchase and flag anything that may affect your cover or your lending.
If you are buying or selling a unit title property in Auckland, we recommend speaking with us before you sign an agreement. Contact Ian Mellett at Quay Law, Barrister and Solicitor, by completing our enquiry form below, or call us on 09 523 2408.
The information on this page is provided for general information purposes only and is not legal advice. Every transaction is different, and all matters should be discussed with the team at Quay Law.