I didnt wanna buy seperate fire insurance so i will request master policy from management office.
But management says there will be some fee chargeable for changing the master policy owner name to my name/unit name.

Is that normal practice?

Don't quite understand your question especially the buying separate fire insurance and changing the master policy owner name. I will have a swing at it anyway.

From what I understand, the master insurance is under the name of the jmb for and on behalf of all parcel units.

The premium is based on ur unit size and shared across the board.

So in the event a fire destroys the entire condo or a particular unit, an owner or jmb can make a claim under the policy.

Etiqa use to charge me flat fee of RM 500 for fire insurance only, whereas the Condo master insurance cover building and unit for RM 300. (They need fire insurance to secure my loan)

Doesn't quite make any sense to take a separate insurance. Assuming Condo collapse and they have to rebuild, becoz u bought a separately policy, ur unit doesn't get rebuilt and there's a hole in the middle of the building lol...

Yea the purpose is to submit to bank for the loan, and has to submit every year.
The master policy only covers exterior/common areas only is it? Or it includes the owner' property as well?

If it includes common area as well as private area, wouldnt be the insured amount be higher if compared to buying own fire insurance?

Lastly, assuming those who only needs this because still tied to loan has to pay for it, what about those who already finished paying loan so they do not required the policy (so they do not need to pay) is that right? So who would bear those amount? Absorbed by JMB themself?
Also is this fire insurance fee are part of maintenance fees? If yes, why JMB said i need to pay for the name change on the policy?

Sorry abit confusing coz dont know how to explain lol

Interesting, no one ever asked this questions before. I just blindly pay my insurance premium every year!


Yea the purpose is to submit to bank for the loan, and has to submit every year.
lol… typical banks being kiasi.


The master policy only covers exterior/common areas only is it? Or it includes the owner' property as well?
Covers exterior, interior, common area and even property of the building, say for example your barrier gate not functioning and requires repair due to lighting strike. Yes, it also includes your parcel and property. However you should always check your policy to better what they actually cover. It may sound good on paper as to what they may cover, insurers however won’t make your life easy in filing a claim for lost.

If it includes common area as well as private area, wouldnt be the insured amount be higher if compared to buying own fire insurance?

chicken and egg story. Would you get more discounts if you negotiate in bulk or as an individual? Insurers also want business also  and JMB is like a big fat cow.


Lastly, assuming those who only needs this because still tied to loan has to pay for it, what about those who already finished paying loan so they do not required the policy (so they do not need to pay) is that right? So who would bear those amount? Absorbed by JMB themself?

fortunately, I don’t have to answer this question cause stones will be thrown at me. The burden is imposed on the JMB to purchase some form of insurance (section 93 SMA). Any additional insurance (not mentioned in section 93 SMA) will require a special resolution. The insurance premium is a recognized expenditure that is charged to the maintenance account (section 23(3)©. If you default on your payment, JMB may pursue an action against the parcel owner in the form of a debt.


Also is this fire insurance fee are part of maintenance fees? If yes, why JMB said i need to pay for the name change on the policy?

yes, see above explanation. (a bit of tikam here) If I am not mistaken, the master policy is under the name of the JMB (principal/trustee), whereas the owners are reflected in a schedule (as beneficiaries other the policy as well), so when your parcel is sold, you may require a change of name. As to why your JMB is requiring you to pay for a change of name, you might want to ask them as to the reason and the quantum you are required to pay.

Sorry abit confusing coz dont know how to explain lol
your question very unique, not something I would as either but good question nevertheless.

Please don't waste money on getting a separate fire insurance.

The fire insurance that bought by JMB should be covering the entire building including individual parcel.

You just request the copy of fire insurance bought by JMB/MC from the management office then submit to bank.

No owner can escape from fire insurance, even the property is fully paid.

It is stated clearly in the strata title act, that JMB/MC has the duty to buy the fire insurance to cover the entire building, and individual parcel unit need to pay according to the unit share. Generally, JMB/MC charged the insurance premium incurred through the maintenance account annually one.

So confirmed its actually charged/part of the maintenance fees? In other words i shall not be charged separately when i request for the copy of policy (with owner's name) ?

Slight correction to your question…

It’s charged as an expenditure under the JMB’s maintenance account. The premium has to be paid first, can’t wait for all the parcel owners to pay up. Otherwise, the insurance will never get paid!

You will be invoiced for the amount paid (based on your unit share) as advanced by the JMB for the amount charged to the maintenance account. Normally, once you paid, you get a copy of the policy (with owners name) without charge or any other fees.

*sorry I don’t know why I keep missing out words*


This post has been edited by aurora97: Sep 7 2015, 03:29 PM

Normally, it is not included in the maintenance fee, but owner will incur an extra invoice as mentioned by aurora97.

It is the duty of JMB/MC to get the entire building being covered by the fire insurance.

Ah okay cleared now.
Sorry for confusion coz last year i didnt not pay anything (probably paid by the previous owner that time).

I just checked last year policy, sum insured is RM80,000,000.00
My property 425K.

Anyone knows how's the calculations being done?
Curious to know whether it would be cheaper (if allowed) to ownself buy rather than the master policy.

Ask and you shall receive.


94. Amount to be insured
(1) Any building shall be insured for at least the reinstatement value of the building indicated by the last valuation obtained for the building.
(2) For the purpose of determining the reinstatement value of the building that is required to be insured under this Part, a reinstatement valuation of the building shall be obtained from a registered valuer at least once every five years.
(3) The cost of such valuation shall be paid out from the maintenance account.

*resistance is futile, now pay your maintenance and submit to the JMB/Mc*

This post has been edited by aurora97: Sep 7 2015, 03:58 PM

Insurance company got a standard valuation of the property and premium one.
Just like car insurance.

You do not need to know at all whether individual buy is cheaper or not, as you cannot avoid paying the master policy.
JMB/MC is required by the strata title act to buy the insurance to cover entire building, how can they exclude you and allow you not to pay the insurance?
There is no way to buy a master policy that cover entire building but exclude your unit.

While if you buy your own, it means you have double insurance, but when anything happened, you will be only being compensated by 1.

Oic.
Crystal clear now

boss, you mean only for highrise is it?
landed, it is possible, right?


distribution is vide share unit. similiar to maintenance fees concept.

It is for strata highrise.
As in highrise, you cannot detached individual unit from the building.

While for landed strata, I am not too sure.
Need someone experience in managing or involving in landed strata management before to share their experience.

not landed strata.

landed individual title.
good old conventional linked houses or something similiar.

If no loan, bank no care.
Landed house, no act required owner to do so.

So up to owner decision.

correct. hence i was trying to correct your former sentence as it implied all type of properties.

Reply was given based on the question asked on strata properties, so all the while only focus on strata properties.
So not intend to imply to all property, my bad.

dont get your self confuse. and dont want your time counter check this and that. There will be auditor checking the insurance renewal fee and will be presented during AGM. I believe the premium is the most reasonable.

auditor job is just to make sure the figures are supported by documents, they don't look into commercial aspects of the transaction i.e. whether reasonable or not.

normally how JMB/MC committee members "scheme money" is via the Premium. In your policy statement, the following will be reflected:-

Master Policy A
Premium payable: RM X
GST: RM Y
Stamp Duty: RM Z
Total Payable: RM XYZ

what you don't see is the brokerage/commission earned by the Broker, this is factored into the premium and paid by the insurer/underwriter.

the person concerned may be paying the committee member a portion of his commission as "introducer fee".

the only way to mitigate such practices are through "open tendering" of insurance policy.

why bank still request borrower to send the insurance certificate since it is mandatory to MC to insure the whole building ? becos bank don't know the property is strata or landed?

what if the individual strata unit did not send the cert to bank? bank will buy another insurance separately on behalf of borrower and charge it to loan account??



I fully understand if bank require borrower to insure if the prop is landed.
i stop buying the insurance once i cleared my loan.

the banks are kiasu wan - they still want to be sure 200% the property is insured - that is why they insist on getting a copy of the fire insurance either from the owner or the management of the property.

so I personally ensure I get the fire insurance from the management and send to the bank otherwise the bank will take out a separate fire insurance and charge the premium to your loan account!

so owner end up paying for 2 premiums buta buta..

any banker can verify?

Not a banker, but I can confirm it. HSBC told me the same: provide proof of condo insurance, else the bank will automatically apply for fire insurance and bill you for it. The point is, till you settle your loan, the unit belongs to the bank, not you, and the bank won't take any risk: the unit has to be insured. Every year, have to show the bank evidence of condo fire insurance.

Yea.
And usually management only will provide the certificate (with owner's name) if you paid your maintenance fees and such.

how we know the bank have received it and did not charge us the insurance premiums again?
I have studied all my loan statements but none of them charged me any insurance fee, I have never sent insurance to them

I usually email to them and get them to acknowledge receipt to keep as proof..
sometimes I personally deliver summore..

should be reflected in your statements if they charge insurance premium..if you are sure they did not charge then good for you..

hsbsc is quite anal when it comes to this matter..cimb too..

mine is UOB, Hong Leong, Maybank, Alliance. so far the insurance fee are not shown in my statements

Bank just wants to protect their interest.
Bank gave loan to borrower, and caveat the property as collateral.
So if borrow unable to pay, bank still have property that can be auctioned and recoup the loan money.

While if the property is damaged due to fire, bank still have fire insurance to cover upon it.

Imagine, if the property is damaged due to fire, borrower doesn't want to pay the outstanding loan, by then bank left with nothing already.

You cannot discard there may be MC that is ignorance to buy insurance for the building/property, so bank want to ensure it is covered to protect their interest as well.

Also, MC will not able to buy insurance, if unit owner doesn't pay up their portion.
We have many cases the unit owner doesn't pay out their outstanding monthly maintenance fee as well result in building is poorly maintained.
There may be also potential case no proper MC is formed as well.

I went to see a banker today regarding an under con property which is currently in foundation stage. I wish to cancel the fire policy charged by the bank as I dont want to have 2 fire policies. But the banker said i need to obtain a copy of fire policy from the developer, despite him noticing a clause in s&p that the developer will cover the fire policy. What should i do? Tq in advance

Request a fire insurance policy copy then, they should able to produce one for you, if they indeed bought the master fire insurance for all.
It is quite a standard procedure.

If I purchased a subsale and obtained a loan, will the bank require that I buy a fire insurance at this point?
As the S&P has yet to be executed, I do not have access to the JMC yet (neither would the policy show my name at this point), how do I go about it if the bank requires for this?

usually bank wont ask now. they will ask before loan get to be released, even if it doesn't show ur name, it shows the postal address of the property which is sufficient for the bank.