Property Insurance query - contract issue

Hi everyone,
Hope you're all well.
Very much hoping for your thoughts and advice on the matter and if you can point me in the right direction as to legal advice I'd be grateful.

I'll get straight into it:

We have 5 units in Casino which was hit by the floods. All the tenants are out and safe thankfully.

AAMI are our insurers and have had a building assessor go in to work out the cost of the damage. They have said $280k BUT........ due to the age, condition and the fact that it doesn't meet modern day codes, the building assessor will not carry out the work as they are not prepared to warranty the with they do on it. They have also requested a structural engineer to come in and look at the foundations as they are worried that they might have moved. The be engineer is due in the next 2 weeks.
AAMI have said that they are waiting to hear from the structural engineer and the foundations, but that they will be paying the $280k to cover the damage but I'm going to have to find my own builder to do the work.
The units are insured for over $900k and I'm thinking AAMI are going to try and shaft me.
These are some of my thighs/concerns which I'd appreciate your thoughts and expertise on:

- surely if AAMI has been prepared to insure the property all these years, knowing full well the age of it, they should either be finding a builder that will warranty their work or should be repairing the building to modern codes?

- if the footings have shifted then presumably the building assessor will take this into account and alter his repair costs.......... I'm just worried that they might be in league with AAMI (I'm a little cynical).

Here is another thing:
All 5 units had been occupied permanently for years up to the floods. A week before the flood the chap in unit 1 decided to leave to travel. We had another chap lined up to go in and was due to sign the lease on the Monday when the banks broke so he couldn't sign it. The units are uninhabitable so he's not thing to sign it now.
AAMI are only covering my rent for 4 out of the 5 units because a lease hadn't been signed for that one unit.
What are my legal rights here? Anyone?

Cheers in advance for your help and advice.

Regards.

 

Better description of the damage required....

Better description of the event, did it wash away under the foundations....

The age of the units shouldn't matter if you can show they have been properly maintained and upgraded to meet current standards, so what codes are not up to "standard" ?

As with the one not leased, a letter (or email copies of the communication with incoming tenant) from the strata may help, but ultimately your policy will detail they only cover rent for currently tenanted premisis (you are lucky they haven't found an excuse to not cover any of the rents).

Imagine the cost of insurance if they had to go and inspect each property annually to ensure the premisis is up to standard and insured appropriately for replacement cost !
As you "estimate" the insurable value it is easy to be underinsured, and they can easily say you are under insured, with building price rises the entire replacement cost could be $1.2M, leaving you underinsured by $300K and they may only cover 75% of the estimated repair value due to this.....

Glad you were insured, many weren't due to the higher cost

 

Most insurers will only cover rental default where a fixed term lease is in place. If it's lapsed onto a month to month arrangement, you will get very little rent default or none at all. Terri Scheer is probably your best bet in this regard.

 

Insurers will generally refuse to pay reinstatement when the property cant be reinstated to code as it was not fully damaged and the loss is totally insured. They will offer to settle and allow you to pay the extra. And most policies refer to leases...not rent. Rent is a payment. A lease is a contractual right to receive payment. No lease,? Is there a loss?