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Strata Managers: how do you handle a crisis?

By Lia de Sousa on

From raging fires to torrential flooding, a critical event can occur at any given moment for the strata properties you manage. In early February 2019, a fire ripped through several balconies at the Neo200 building on Spencer Street in Melbourne. As a Strata Manager, how would you respond to a similar crisis at a property you manage?

In this article we outline several best practice strategies in crisis management, and how Strata Managers can oversee the recovery of a critical event.

Your role during a crisis

Despite many years of good work in building strong relationships with your strata clients, a Strata Manager’s reputation can become severely tarnished overnight if a crisis isn’t managed effectively. 

As a Strata Manager, it is up to you to take the lead when a crisis event occurs. From consulting with the Owners Corporation and tenants, to dealing with external agencies such as the fire brigade or civil engineers, a Strata Manager must govern the response to a crisis from start to finish, ensuring all key stakeholders have been included and looked after.

Managing a crisis after it has occurred

When managing a crisis, it is crucial to understand the various stages, and unique issues that may materialise during recovery. While there will be immediate concerns following the crisis event itself, there may be other serious issues that arise and require management in the medium to long term. Using a building fire as a case study, we have outlined some examples below:

Immediate issues

  • Evacuation of some or all residents / tenants 
  • Liaising with emergency services
  • Emergency accommodation arrangements post-evacuation should the crisis be severe

Medium-term issues

  • Cause investigation
  • Maintenance of building security and the security of residents’ personal property
  • Enabling access to the building for residents to recover essential belongings
  • Management of external agencies e.g. emergency services, insurers, engineers, property owners, and repairers who perform rectification works

Long-term issues

  • Obtaining permission to reoccupy the building safely

Understanding the different stages of a crisis, and having a clear crisis response plan in place for your business is essential. It can help ensure the proper management and rectification of any issues, ensuring the crisis at hand is handled successfully.

Managing people affected by a crisis

One of the most important aspects of overseeing a crisis is ensuring that people affected by the event, both directly and indirectly, are properly managed.

When planning the management of various scenarios, it is important to consider the following:

  • Who is impacted by the crisis? Is it primarily tenants and owners of the building, or are residents of neighbouring properties affected as well?
  • What can be done to minimise the impact of the event, and how can you best support the people impacted?
  • Are there emergency funds available to assist? E.g. emergency accommodation funds as part of the Strata Insurance.

Comprehending the scope of the situation and how you and your firm can support all affected individuals, can help ensure there is minimal fallout post-crisis, and that all of your clients’ needs have been taken into consideration.

Communication is key

Flooded basement carpark resizedTo see that all parties involved stay informed, ensure any information relevant to the crisis is communicated clearly from one central spokesperson, and that it is accurate.

Post-crisis, you and your office can become inundated with a barrage of queries from key stakeholders, for example:

  • What was the cause?
  • Can I go and get my belongings?
  • When can I move back in?
  • Is my apartment damaged?
  • Why can’t I move back in, my apartment is not damaged?
  • Who can I sue for my loss?
  • Is temporary accommodation covered by Strata Insurance?
  • Will the Strata Insurance replace my damaged belongings?
  • My real estate agent told me to call you to find out about insurance for my damaged belongings…

Having multiple contacts can give rise to misinformation, causing undue stress for affected individuals. Ensure that all information available is properly communicated to all key stakeholders from a central source.

Formulating the contents of your communications

There are 4 key principles to follow when issuing communications after a crisis has occurred:

  1. Show compassion, care and concern for the affected individuals
  2. Identify the cause of the incident per the factual information provided by reports
  3. Inform affected individuals of the actions being undertaken
  4. Provide a timeframe for the resolution

Residents and owners who have been displaced by a crisis are often emotionally fatigued. Showing concern for their wellbeing, and providing all relevant information in a timely, efficient manner can go a long way to alleviating the stress faced by those affected. It can also show that you are acting in their best interests.

Ensure a thorough record of the event is kept in its entirety

Record keeping is essential during a crisis. Logging records of what your business said, and how it behaved during a crisis can be a valuable resource in the future, particularly if your actions are questioned in a court of law. 

Ensure you:

  • Log the incident and events as they unfold,
  • Note all key facts and assumptions in relation to the crisis,
  • Record all actions taken at each stage,
  • Keep a list of all outstanding action items for follow-up at different points in the response.

Well-documented records can demonstrate that you and your firm made every reasonable effort to ensure that a situation was properly managed, with the best interests of your key stakeholders at heart.

The benefits of an insurance broker

With complex legislation, and the intricate, highly involved nature of managing Strata Insurance and Strata Insurance claims, the role of an insurance broker is more important than ever.

An insurance broker can help alleviate the significant workload and legal responsibility associated with managing Strata Insurance for your clients. As qualified and licensed insurance brokers, we provide ‘personal advice’ – advice which takes into account the specific circumstances and needs of your clients. This helps ensure your clients have the most affordable and suitable policy in place.

With a dedicated Whitbread account manager, you have the benefit of contacting the same insurance broker every time you need advice. By building a strong rapport, we can better understand not only your needs as a Strata Manager, but the needs of your clients.

The value of an in-house claims team

Whitbread have an internal specialist team dedicated to the management of Strata claims. Our claims consultants act as your advocate, to ensure your clients receive the best possible outcome via mediation, and when required, escalation to the Australian Financial Complaints Authority (AFCA).

With over 40 years of experience, Whitbread are specialists in arranging insurance solutions and managing claims for Residential and Commercial Strata properties. Our depth of knowledge and understanding gives us a unique insight into Strata risks, ensuring you receive the very best level of advice and service to benefit you and your clients.


Looking for more information on Crisis Management? Read our series of articles below:

Crisis Management Part 1: Reducing the severity of a crisis and the impact on your Strata Management business
Crisis Management Part 2: Preparation is everything
Crisis Management Part 3: Careful planning can stop a crisis from turning into a disaster

 

If you would like further advice on developing a Risk and Crisis Management Plan to protect your Strata Management firm and clients, please contact your Whitbread Strata Insurance specialist on 1300 424 627.

 

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This article is not intended to be personal advice and you should not rely on it as a substitute for any form of personal advice.  Please contact Whitbread Associates Pty Ltd ABN 69 005 490 228 License Number: 229092 trading as Whitbread Insurance Brokers for further information or refer to our website.

 

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