Condominium Insurance
Effective January 1, 2020, revised condominium governance regulations came into effect in Alberta. Condominium corporations must maintain insurance to protect common property and condominium units against loss from destruction or/and damage.
The changes further clarify:
- The condominium’s requirement to maintain insurance coverage on individual condominium units
- Specifies what the corporation’s insurance does not cover
- The types of additional insurance condominium corporations may impose on owners, and
- Claim back on insurance deductible from the unit owners.
Pursuant to the new regulations, the amount of insurance that a condominium corporation must have on individual condominium units depends on the type of unit. Unless required by the corporation’s bylaws, the condominium corporation’s insurance does not extend to any improvements made to the units by the owners. Condominium corporations can now impose additional insurance requirements on the unit owners and require unit owners to purchase insurance for deductibles that may be payable to a corporation, specify the particulars of deductible insurance to be purchased and, specify the proof an owner must provide the corporation of purchased insurance.
An insurance deductible is money that an insured party must pay before the insurance company will pay out expenses for a claim. Under the new regulations, if damage for a claim originates in or from an owner’s condominium unit including its exclusive use areas, then the condominium corporation can claim back the insurance deductible from the unit owner directly, up to a maximum amount of $50,000. In this situation, the owner is then liable to the condominium corporation on demand by the condominium corporation. This means that whether or not there was any proven negligence, the condominium unit owner is liable for the corporation’s deductible.
Recommendations for property owners of condominium units:
- Secure insurance where the owners’ deductible coverage will cover the corporation’s deductible when applicable or needed. Check with your insurance provider expert to discuss this type of coverage.
- If you already have deductible coverage in your unit owner’s policy, it is prudent to adjust your deductible coverage accordingly with respect to the corporation’s policy and with the recent changes in the Condominium Property Act.
- You can request your condominium board, property manager or corporation’s insurance broker for a copy of the condominium corporation’s Certification of Insurance, which outlines current deductible amounts
For the latest information to Albert’s Condominium Property Act and Regulation, please check:
https://www.condolawalberta.ca/governance-operations/insurance/
