Understanding Excess Liability in Insurance Claims

Overview of Excess Liability

In the context of insurance claims, the term “excess” refers to the amount the claimant is required to pay out of pocket when submitting a claim. It is important for owners to understand their responsibilities regarding excess payments, particularly in accordance with the Sectional Titles Schemes Management Act.

Key Points:

1. Claimant Responsibility: Unless specified otherwise, the claimant is always liable for the excess on an approved claim.
2. Owner Liability: As per the Sectional Titles Schemes Management Act, Regulation 23 (2):
   • The owner of a section is responsible for:
     • (a) Any additional premium resulting from an increase in the replacement value.
     • (b) Any excess amount related to damage to parts of the buildings that the member is obligated to repair and maintain according to the Act or the rules.
3. Recovery of Excess: If the owner wants to dispute or recover the excess amount, they must do so in their personal capacity, either with the body corporate or another owner.
4. Typical Scenario: The individual who submits the claim typically pays the excess. If the damage originates from another unit, the affected owner may need to discuss the situation directly with the responsible party.

Understanding these points can help clarify any confusion regarding excess payments and the responsibilities of property owners.