The Importance of a Condominium Unit Owners Policy

The strata’s insurance policy is very comprehensive, providing full ‘All Risks’ coverage for the structure as originally constructed. However, in the event of a loss, even if you are not at fault whatsoever, it is imperative all unit owners have a condominium unit owners policy in force to compliment the strata’s insurance.

Key coverages provided under a Condo Unit Owners Policy include:

    • coverage for your personal property and contents. The strata’s property insurance policy will not respond to lose or damage to your contents, regardless of the cause of the loss or damage. Further, you are responsible to remove contents as required to repair the building, a unit owner’s policy will protect you from the move-out and storage costs.
    • additional living expenses coverage. You may require alternate accommodation following loss or damage to your unit, your unit owner’s policy will provide coverage for the costs of alternate accommodation following an insured loss.
    • unit improvements and betterments. The strata’s policy covers the building was originally constructed and does not cover any upgrades whether made by you or a previous owner. A unit owner’s policy covers unit upgrades, such as laminate flooring.
    • personal liability. The strata’s liability insurance covers the strata corporation and unit owners only insofar as to their ownership or maintenance of common property. A unit owner’s policy protects you from personal liability which could include claims arising from your unit or your actions, including legal defence costs.
    • loss assessment coverage and unit additional protection. In the event of a claim resulting from your unit, you will be assessed the strata corporation deductible. ‘Loss Assessment’ coverage protects you from this assessment. It is imperative you have coverage up to the strata corporation’s water damage deductible. In the event, there is the loss or damage the original structure of your unit which does not exceed the strata deductible, the strata corporation typically does not have a duty to repair under the Strata Property Act and Standard Bylaws. ‘Unit Additional Protection’ is protection against loss or damage to your unit, for which the strata’s policy will not respond.
    • earthquake deductible assessment. Given the exposure to the earthquake in the lower mainland, the strata’s earthquake deductible is high, typically 10 – 15% of the insured property value, depending on the location. In the event of an earthquake, you will be assessed for your share of the strata’s earthquake deductible based upon unit entitlement. Earthquake deductible assessment provides a specific limit of coverage for your assessed share of the strata’s earthquake deductible.

Not all policies are the same! Be sure your policy has coverage for water damage, sewer back-up, loss assessment and unit additional protection.

The above is intended to provide general information only, please refer to your policy wordings for specific coverage information and please contact your Insurance Broker should you have any questions.

Kevin Casey  CAIB
Client Executive, Partner

CMW Insurance Services Ltd.
700 – 1901 Rosser Avenue, Burnaby, BC  V5C 6R6
Tel 604 484 4976  |  Fax 604 294 3003  |  TF 1 800 263 3313

kcasey@cmwinsurance.com
cmwinsurance.com

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