Home insurance policy provides coverage for five main areas:
- The primary dwelling/building
- Other Structures such as storage sheds and detached garage
- Personal property
- Loss of use (if the dwelling is uninhabitable due to damage)
- Personal Liability (if your negligence caused injury to a person or his property)
The home policy is generally an “all perils” type of coverage that includes damage due to fire, theft, wind, hail, hurricanes, water and sewer backup. Earthquake is available for extra premium.
The policy provides replacement cost for both building and contents.
Condo insurance policy provides coverage for seven main areas:
- Personal property
- Loss of use (if the dwelling is uninhabitable due to damage)
- Improvements and betterments (installed in your unit, including materials and installation)
- Loss assessment (the insured’s share of a special assessment to the collectively owned strata property, made necessary by an insured peril)
- Additional protection (if the Strata Corporation has inadequate insurance, this will pay for the insured’s share of the loss)
- Deductible reimbursement (pays for the Strata Corporation's deductible if the damage originates from the insured’s unit)
- Personal Liability (for both individual unit and a possible shortfall in the Strata’s liability)
The condo policy is usually purchased with the intent of covering the insured’s personal property, however, the package includes much more. There are many perils that are unique to strata ownership.
The building is owned collectively by the unit owners under a “Strata Corporation.” The Strata pays for building repairs and maintenance to building and grounds, as well as insurance for the building only.
There are dollar limits for all of the condo coverages and those should be carefully reviewed with your insurance broker.
It should be made clear that condo insurance does NOT cover special assessments made necessary by building maintenance issues such as replacement of roof, heating system or damage due to mold or deterioration.
Pete Tolsma has been employed in the insurance industry for over 30 years. His experience spans Insurance Adjuster with ICBC, Personal Lines Manager and Partner with Allan Tolsma Agencies, and General Manager for Hub International Insurance. At the time this article was written, Tolsma was employed as Personal Lines Manager and Partner with Maxxam Insurance Victoria.
