(1) In this
strata company means a strata company for a scheme
other than a single tier strata scheme.
(1a) Subject to
subsection (4) and section 103J, a strata company shall —
insure and keep insured the building to the replacement value against fire,
storm and tempest (excluding damage by sea, flood or erosion), lightning,
explosion and earthquake; and
effect and maintain insurance in respect of damage to property, death, or
bodily injury for which the strata company could become liable in damages in
an amount of not less than $5 000 000 or such other amount as may be
prescribed in place of that amount.
(2) A contract of
insurance entered into for the purposes of subsection (1a) may provide
that, instead of the work and the payments specified in the definition of
“replacement value” in section 53 being carried out or made
upon the occurrence of any of the events specified in the policy, the
liability of the insurer shall, upon the occurrence of any such event, be
limited to an amount specified in the policy.
(3) It is a defence to
a charge of an offence against subsection (1a) for a strata company to
prove that, despite having taken all reasonably practicable steps available to
it to comply with that subsection, no insurer is willing to enter into a
contract of insurance, on reasonable terms, that meets the obligation imposed
by that subsection.
(4) In the case of a
survey-strata scheme, the obligation of the strata company under
subsection (1a) applies only to a building that is common property in the
[Section 54 amended: No. 58 of 1995
s. 52 and 94; No. 61 of 1996 s. 27.]
[Heading inserted: No. 61 of 1996