One underinsured claim doesn't just cost you a building. It can reach into the rest of your portfolio.

Quick answerBecause a portfolio multiplies every mistake. Each property is one more chance for a stale sum insured, a wrong entity name or a thin loss-of-rent period, and portfolio renewals commonly run one property at a time, so nobody ever looks across the set. Meanwhile indexation, where a policy has it at all, has been quietly losing ground against construction costs that rose 31.1 per cent between 2020 and 2024 (ABS building construction output prices).

Three things make property owners more exposed than they feel.

Indexation has been losing the race. Where a policy indexes the sum insured at all, the uplift typically tracks building-cost indices, recently around 3 per cent a year (Cordell indices, via Strata Community Insure), and many commercial policies carry no automatic indexation whatsoever. Building construction costs rose 31.1 per cent between September 2020 and June 2024 (ABS). A sum insured that has only ever been indexed, never re-measured, falls further behind every renewal, and even a proper valuation report from a few years ago drifts out of pace, especially if you chose a sum insured below the report's recommendation at the time. Across several properties, small gaps compound into a collective shortfall that can run into the millions.

Entities create gaps paperwork can't see. Properties accumulated over 10 or 15 years tend to end up in different names: yours, a family trust, an SMSF. If a policy names an entity that does not own the asset, the whole policy can fail at claim time. More on this below, because it is the most expensive mistake on this page.

The rent is the actual asset. For most owners the building is the vehicle and the rent is the point: it pays the loans, and often the lifestyle. Loss of rent cover is what keeps that income arriving after an insured event, and it only works if the amount, the period and the outgoings are all set deliberately. The mechanics live on Commercial Landlords Insurance; the short version is that our default indemnity period is 18 months, we recommend 24 wherever we can, and 12 is a floor we place only on a client's express instruction.

Sometimes a good broker can reduce the damage, though no one can undo it. In a 2025 storm claim CIB handled, a regional NSW landlord had insured a retail building for $500,000 against the roughly $1.99 million we advised in writing. The average clause still cut the partial-loss payout to about 48 cents in the dollar. But CIB found two wording points the client's own paid claims advocate had missed, and the insurer amended the settlement onto our figure. The full story is in The Co-Insurance Clause: What Every Building Owner Must Know.

On a total loss the full sum insured is paid, and the gap between that and the real rebuild cost is the owner's.

Quick answerThe insurer can decline the claim, because the named insured does not own the thing that was damaged. This is one of the most expensive structural mistakes in commercial property, it is invisible until claim time, and it usually happens innocently: a restructure nobody told the broker about, a policy in a director's personal name while a trust owns the building, or a trustee named without the trust.

The three versions we see are all quiet. A property gets moved into a new structure and the policy keeps renewing in the old name. A building bought through a trust or SMSF gets insured in the director's personal name because that is who filled in the form. A trustee gets named without the trust behind it. Each one creates the same defect: the entity on the policy does not own the asset, and at claim time that is not a typo, it is a non-disclosure problem.

Here is an illustration, and we flag it as exactly that, an illustration rather than a claim we handled. A building owned by the Smith Family Trust is insured in the name of Smith Holdings Pty Ltd, the trading company, because the same person stands behind both. Fire guts the building. The insurer's first question is not about the fire, it is "who owns this building?", and the answer is: not the insured. Everything that follows is an argument you do not want to be having in the same week as a fire.

The SMSF version adds a second trap. If your super fund owns the building and your operating business is the tenant, there must be a formal, arm's-length written lease between the two entities. That is an SMSF compliance requirement, and the detail belongs with your accountant. Our side of it is blunter: no lease means no legal tenancy, which can mean the loss of rent section has nothing to attach to. We proactively check the lease position as a matter of course for every client in this position, and if the lease makes the tenant responsible for insuring the owner's fitout or plant, the policies have to reflect that transfer too. The rent the policy insures follows the actual rent on the lease, and if your leases let you recover outgoings, those figures belong in the loss-of-rent sum as well. For the deep version of how insurance works when your super fund owns the building, see SMSF Commercial Property Insurance.

Quick answerEvery property gets a registered valuer's desktop assessment commissioned at no cost to you, at new business and every renewal. Every roof gets an aerial condition check, every year. Every policy gets checked against the entity that actually owns the asset, every lease between related entities gets confirmed before we rely on loss of rent, and the whole set is remarketed annually by one account manager who knows the portfolio.

• A desktop building replacement valuation on every property, every year. Commissioned at no cost to you, for our purposes as your broker, to inform the advice we give you. Own four properties and you get four desktop valuations, not one for the flagship and indexation for the rest. See Desktop Building Replacement Valuation.
• A roof check on every property, every year. Nearmap aerial imagery reviewed alongside the desktop valuation, more than 1,200 checks a year across our clients, flagging issues while they are still maintenance rather than a claim dispute. See Roof Condition Monitoring.
• An entity and lease review. Every policy in the right name, financiers noted as interested parties, and leases between related entities actually in place before anyone relies on loss of rent cover.
• The one-programme assessment. We do not default either way; we weigh the portfolio's value and complexity and show you the comparison.
• Loss of rent set deliberately on every property. Default 18 months, we push for 24 wherever we can, and your outgoings figures included where the leases recover them.
• Risk advice, not paperwork audit. A review with us is also us telling you what information to get to us, so cover can be made adequate rather than merely documented. Your renewal gets shopped, checked and explained, every year.
• One account manager across the whole portfolio. Not a different broker per property, not a renewal call centre.