CHU's 2025 Strata Market Report: Navigating Stability and Emerging Challenges

One of the key findings is the relative stability of strata insurance premiums. Over the twelve months leading up to June 2025, premiums increased by 2.8%, with the average annual premium per lot rising from $954 to $981. This growth rate is lower than the 3.4% increase in household incomes over the same period, indicating that strata insurance remains affordable for apartment owners. In contrast, premiums for standalone house insurance surged by 14%, highlighting the comparative stability within the strata sector.

The report also addresses the impact of climate-related events on the industry. In 2025, Australia experienced significant weather events, including Tropical Cyclone Zelia and widespread flooding across multiple states. These events have underscored the importance of climate risk management in strata insurance. Despite these challenges, a review by the Australian Reinsurance Pool Corporation (ARPC) in September 2025 found that premiums for strata properties would remain unchanged, suggesting that current pricing remains adequate for the risk profile of strata properties.

Regulatory developments are another focal point of the report. Reviews in New South Wales, Western Australia, and the Australian Capital Territory are introducing new requirements aimed at enhancing transparency, consumer protection, and professional standards within the strata sector. For instance, New South Wales has implemented reforms that include standardised maintenance planning, enhanced conflict-of-interest disclosures, and improved hardship protections for owners.

Emerging risks, such as building defects and the rise in lithium-ion battery fires, are also highlighted. The report notes that nearly half of all strata buildings are over 25 years old, creating a growing need for maintenance and upgrades. Additionally, the increasing use of lithium-ion batteries has led to safety concerns, with incidents reported in various states. In response, regulators have issued new safety guidelines, and many strata managers are implementing formal battery management policies.

Looking ahead, the report forecasts that affordability, climate resilience, and regulatory compliance will remain central themes for the strata insurance sector. Key developments anticipated in 2026 include further reforms in New South Wales, the conclusion of Western Australia's five-year strata law review, and the next ARPC Cyclone Pool assessment.

Kimberley Jonsson, Chief Executive Officer at CHU, commented that one in ten Australians live in strata, with more than three million total lots across the country, and that number is only set to rise. As density increases, so do expectations. The strata sector has an opportunity to set a new standard for urban living across Australia.

For strata property owners and managers, staying informed about these trends and proactively addressing emerging risks will be essential in navigating the evolving landscape of the strata industry.