Are your client’s buildings situated on underwater pier foundations?

The recent partial collapse of ‘Milano’s on the Lake’, a two storey building into Lake Macquarie, Pelican Marina in NSW brings to light a critical insurance issue that requires a ‘should have’ discussion for Brokers and their Clients who have buildings on underwater pier foundations. 

The partially submerged building that housed several businesses including the popular restaurant and function centre continues to fall in the water. It will soon be demolished even though the structure was

declared structurally safe two months before collapse
— 1233 ABC Newcastle (1)

If any Broker has clients with structures on underwater pier foundations, we suggest they seek clarification from them on the following:

  • Who actually owns the piers?
  • Who is responsible for the insurance coverage?
  • If there is a landlord and tenant; are both parties aware of the current sums insured for the building AND pier support?
  • If they are, then more importantly, are they insured adequately?

Only an independent building insurance valuation will provide the answers above.

Milano’s on the Lake is a prime example of why no-one should think their assets are untouchable.

There was nothing in that report to indicate that there was a danger of imminent collapse but obviously something has occurred since then so we will be investigating that.
— Tim Deverell, Department of Crown Lands Hunter Manager (2)

Clients actively choosing to skip an insurance valuation need to know they can only rest assured knowing their sums insured are correct if they have had a recent insurance valuation conducted. Without one, they could find themselves paying for incorrect insurance coverage and being inadequately reimbursed if disaster strikes.

So, are your client’s buildings, site improvements, contents AND pier support insured, correctly? 


(1) Read more Lake Macquarie restaurant Milano's declared structurally safe two months before collapse - 1233 ABC,  9 February 2016

(2) Read more Lake Macquarie restaurant collapse: business owners count the cost - Sydney Morning Herald, 9 February 2016