Apartment cover claims mounting

Auckland apartment residents are increasingly making insurance claims for a wide range of damage, including a sewage discharge caused by burst pipes and flooding caused by fire sprinkler systems.

Peter Lyons, underwriting director of Oceanic Insurance, said claims had increased noticeably lately.

He said flood damage from fire sprinklers, activated by a cooking oil fire in a frypan, had sparked one $20,000 insurance claim. Fourteen Parnell apartments were damaged last year after fire sprinkler water coursed across the floors and through unit ceilings.

In another incident, four Hobson St units were flooded after an occupant dropped a frypan on to the carpet, activating the sprinklers.

Effluent from a burst sewage pipe damaged two Hobson St units before seeping down the wall of the block's gymnasium and into its carpet.

"When this happens, the areas have to be completely sanitised, so it's not just a matter of cleaning it up and repainting," he said.

Lyons is concerned that many people are not aware of the specialist insurance requirements for apartment properties.

"Because of the nature of the buildings, and the fact that an insurance policy has to conform to the Unit Titles Act, some insurers are not aware of their obligations and are insuring but are finding it financially difficult," he said.

Takapuna-based Oceanic is an underwriting agency specialising in residential and commercial body corporate insurance.

Oceanic insures body corporates administering the tower units. Lyons said the firm had about half the Auckland inner-city apartment insurance business.

He called for apartment residents and owners to take a careful look at their insurance and ensure it covered the specific needs for high-density accommodation.

Jean Holt, of Crocker Strata Management, which manages many apartment tower blocks, said she knew of water damage to apartment units but said she was unsure if it had reached what she called epidemic proportions.

"But there are claims for these types of incidents," she said.

"Specialised insurance products are required for high-density living because of the spread of damage that emanates from each incident."

Fire safety officer Russell Dickson said last week apartment residents were taping up smoke detectors to reduce false alarms. 

Some of the claims

* Blood-staining after knife attack in new Queen St unit leased to Housing Corp tenant.
* Car damaged when automatic roller-garage door closed on top of it.
* Flooding from towel blocking shower waste after it was left running all day.
* Glass repaired after bullet hole through unit window.
* Flooding from washing machine hose blow-out.