All strata insurance policies, at least every single one that I have ever seen, has an earthquake clause. The deductible is usually 10% of the total replacement value of the property, but this can be increased or decreased, and your premium may go up or down along with this. We see some buildings go up to 20%, and some take it down to 5%. There is also a minimum amount, usually $250,000 which would only come into play for smaller buildings with lesser replacement values.
As an example, say that your 50 unit strata building has a replacement cost of $20 million. This is the value that it would cost to demolish and rebuild the building to original specs, not including any upgrades, etc.
In this example, you have a 10% deductible, meaning that it would cost the strata $2m out of pocket to rebuild in the event of an earthquake, or roughly $40,000/ unit. The exact breakdown will be according to unit entitlement, the same calculation that is used to determine your strata fees. It’s super important to remember to include this deductible in your personal home insurance, just in case a big one ever hits!
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