Strata-titled properties have an estimated insured value of $1.3 trillion, which is set to rise as the proportion of residents living in townhouses, apartments and units continues to grow, according to a new report.

The Strata Community Association-funded (SCA) report found at least 16% of Australians – but potentially as high as 26% – at present live in strata-titled properties, with 10% of the population in apartments and 6% in other strata dwelling types such as townhouses, retirement villages and strata-titled detached housing.

SCA National President Chris Duggan says the findings from the report underscore the potential of the market for strata insurance providers.

More than 200,000 new lots such as units and townhouses were built in the last two years and there are now more than three million strata and community-titled lots across the country.

In NSW, the biggest by population, the state became the first to surpass one million strata lots with 9% growth over two years.

“This market will continue to grow and demand for strata insurance is outpacing the growth of the sector more generally,” Mr Duggan told insuranceNEWS.com.au.

“So we need to ensure that the strata insurance sector works closely with owners and managers to ensure that we can support the critical need for this insurance product across Australia.”

The report was prepared by the University of NSW City Futures Research Centre and is the final instalment in a three-part series to provide a picture of the strata industry in Australia and New Zealand.

The report found half of Australia’s strata building stock was built before the year 2000, highlighting retrofitting needs.

Mr Duggan says this is an area with potential insurance implications given insurers’ focus on building quality and maintenance matters.

“So I think this gives us data to know where to focus our preventative activities,” Mr Duggan said.

“The implication for the insurance sector is that there will continue to be a focus on what is being done to ensure buildings are up to date with their preventative management and I think there will be a benefit for those buildings which have a better maintenance regime and better governance around the approach to common property areas.”

Click here for more from the report.