South Australian Current Acts South Australian Current Acts43—Insurance by unit holder
(1) Nothing in this
Act limits the right of a unit holder to effect insurance in respect of the
unit.
(2) A contract of
insurance may be entered into by the unit holder in respect of damage to the
unit for an amount equal to the amount secured at the date of the contract by
mortgages over the unit.
(3) Where a contract
of insurance of the kind referred to in subsection (2) is in force—
(a)
payment must be made by the insurer under the contract to the mortgagees whose
interests are noted in the contract in order of their respective priorities,
subject to the terms and conditions of the contract;
(b)
subject to the terms and conditions of the contract, the insurer is liable to
pay under the contract—
(i)
the amount stated in the contract; or
(ii)
the amount of the damage; or
(iii)
the amount sufficient, at the date of the payment, to
discharge the mortgages noted in the contract,
whichever is the least amount.
(4) Where the amount
so paid by the insurer equals the amount necessary to discharge a mortgage
over the unit, the insurer is entitled to an assignment of that mortgage and
where the amount is less than the amount necessary to discharge a mortgage
over the unit, the insurer is entitled to obtain from the mortgagee a transfer
of a proportion of the mortgagee's interest in the mortgage equal to the
proportion that the amount of the payment bears to the amount owing under the
mortgage immediately before the payment.
(5) Money received
under any such contract of insurance is not liable to be brought into
contribution with any other money received under another contract of
insurance, except where the other contract of insurance—
(a) is
in respect of damage to the same unit; and
(b)
relates to the same mortgage debt.