Why More Disputes Are Heading to the Community Schemes Ombud Service
The number of complaints sent to the Community Schemes Ombud Service (CSOS) has risen for the second year in a row. In the 2024/25 financial year, CSOS received 16,791 new dispute‑resolution applications – that’s a 7.7 % jump from the 15,587 cases filed the year before.
Most of these disputes involve money matters and how the body corporate is run, especially issues with trustees’ decisions.
What Trustees Get Wrong
Ryno de Kock, a sales manager at PSG Insure, points out several common slip‑ups made by trustees:
- Poor maintenance planning – buildings aren’t kept up to standard, leading to bigger repair bills later.
- Weak monitoring of service providers – contractors may do sub‑standard work or overcharge.
- Incorrect or outdated insurance values – if the insured amount is too low, owners can end up paying out‑of‑pocket after a loss.
Why Sectional Title Insurance Matters
Body corporate insurance (also called sectional title insurance) is bought by the scheme to protect:
- The building structure and common property.
- The financial interests of all owners.
The Sectional Titles Schemes Management Act (STSMA) says schemes must have cover for:
- Fire, storms, riots and certain water damage.
- Liability (minimum R10 million per claim).
- Fraud or dishonesty that could steal scheme funds.
The goal is to let the scheme recover from a major loss without hitting owners with special levies.
Common Misunderstandings
Many owners think their personal insurance also covers everything inside their unit. In reality:
- Personal property insurance usually only covers the building’s structure and shared areas.
- Owners still need separate policies for household contents and personal liability inside their own unit.
Keeping Insurance Up to Date
De Kock stresses that trustees should:
- Review replacement values every year.
- Do a formal reassessment at least every three years to account for inflation, rising building costs and any upgrades.
- Match the insurance policy to the scheme’s actual risk profile – otherwise important risks may be left uninsured.
Guarding Against Fraud
Regulation 15 of the CSOS Act requires schemes to have fidelity guarantee insurance. This protects the scheme’s money from theft or fraud by trustees, officers or directors.
Weak governance and poor financial controls make fraud more likely, so having the right cover and strong oversight is essential.
What Owners Can Do
Stay informed, ask questions at meetings, and check that:
- Maintenance schedules are being followed.
- Insurance values are current and adequate.
- Liability and fidelity cover meet the legal minimums.
- Any gaps in coverage are identified and fixed quickly.
When trustees keep up with these responsibilities, the whole community benefits – fewer disputes, lower costs, and peace of mind for everyone.
Conclusion
The rise in CSOS applications shows that many sectional title schemes are struggling with governance, especially around insurance and maintenance. By understanding what trustees should be doing and holding them accountable, owners can help prevent costly mistakes and keep their homes safe and financially secure.
