Double insurance can happen when the scheme operator and the resident both effect their own insurance cover for the same property against the same occurrence or event.
But how can that be, you may ask? When one considers the various fixtures and fittings in the average retirement village home, such as carpet as initially supplied by the village at the commencement of the lease, and, when both the residents’ own contents insurance and the scheme operator insurance have a valid insurance policy, then there is the potential for double insurance.
Traditionally, carpet is covered under the contents insurance policy, and there is a well-trodden path of precedence for this, however, under the RV Act “the scheme operator must insure and keep insured, to full replacement value, the retirement village, including the accommodation units”, and the insurance “covers, to the greatest practicable extent”, one can appreciate the potentiality for double insurance.
In the event of an insurance claim, when perhaps both the scheme operator / management and the resident lodge their own insurance claim for the same item, such as the carpet, then both are required to tell their respective insurer the ownership, and, the two insurers would each pay a rateable portion of the loss sustained. Conversely, an insured may choose to claim for any damage under either policy at their own discretion.
The ARQRV would recommend that any resident encourage the scheme operator to submit a claim for, say, carpet to their village insurer on the basis that they are deemed to be the owner of this fixture and more appropriate to handle the loss, which in many cases may involve damage to other items within the home/unit.
Should any member of the ARQRV experience any difficulty in relation to claiming under their resident’s contents policy as the policy excess is less, then please refer the matter to the ARQRV, as there should be a more amicable solution.