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How is Strata Insurance Calculated in Australia?

There are many factors to consider when taking out strata insurance for your property in Australia. In this article, we'll break down how insurers calculate premiums so that you can be better informed when shopping around for a policy.

Strata insurance in Australia is calculated based on the replacement value of the building and common contents. This includes taking into account the current market value of the property, as well as the cost of rebuilding.

Strata insurance premiums are calculated based on a number of factors, including the type of property, its location, the age of the building and the level of cover required. Your strata manager or body corporate will usually arrange for a strata insurance policy to be taken out on behalf of all owners in the scheme.

If you own a strata property in Australia, you are required by law to have strata insurance. Your strata insurance policy must cover the building itself and all common property within the strata scheme. It should also cover your personal belongings within the unit and any legal liability you may have as a unit owner.

The Base Premium in Strata Insurance

Strata insurance premiums in Australia are calculated using a number of different factors, including the value of the property, the age of the buildings and the location of the property. Insurance companies will also take into account the type of occupancy, with commercial properties generally attracting higher premiums than residential properties.

Factors such as excess and exclusions also influence the premium. Lower excess will almost certainly mean a higher premium.

Buildings with better risk management in place, such as fire suppression, maintenance schedules, security and low hazard occupancy usually have lower premiums.

Finally, claims history is a significant rating factor. Buildings with high claims frequency or severity will be charged higher premiums.

Stamp Duty Tax on Strata Insurance

When you purchase strata insurance, you are also required to pay stamp duty tax. This tax is calculated based on the value of your insurance policy. The amount of stamp duty tax you will need to pay will vary depending on the state or territory in which you live.

Emergency Services Levy (ESL)

One of the components of your strata insurance premium is the emergency services levy (ESL). This is a charge levied by state and territory governments to help fund emergency services, such as fire brigades and ambulance services. The ESL is generally calculated as a percentage of your total strata insurance premium.

Goods and Services Tax (GST)

Strata insurance in Australia is calculated based on the value of goods and services subject to GST. The GST is a tax levied on the sale of goods and services within Australia, and is calculated at 10% of the value of the goods and services sold. For strata insurance, this means that the premium is calculated at 1% of the value of the strata property.


Strata insurance in Australia is calculated based on a number of factors, including the size and location of the property, the type of building, and the level of cover required. The premium for strata insurance is usually paid by the owners corporation or body corporate, and it is important to make sure that you are covered for all eventualities. If you have any questions about your strata insurance policy, speak to your broker or insurer for more information.