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Kris' Insurance Corner

Condo owners: Deductible assessment

...“Yikes, I didn’t see that coming.”

You arrive at your posh downtown condo one evening after work. As you make your way through the front entrance, you notice about three inches of water on the floor and a local restoration company dealing with the mess.

As you make your way to your unit, you notice that your front door is wide open and you are then informed that you cannot enter your unit because your washing machine hose burst and flooded your unit and three units below you. Meanwhile a flurry of activity is taking place; workers from the restoration company are doing their best to remediate the water damage using a variety of various vacuums, fans and other equipment.

“Good thing I have insurance!” you cheerfully remark. I will just pay my $500 deductible and all of this will be taken care of. However, several days later the strata corporation presents you with a $50,000 bill for the cost of the deductible for water damage to the strata building and your current insurance policy only has $10,000 coverage for your strata deductible assessment.

“Yikes, I didn’t see that coming.”

As a condo owner, we recommend inquiring within your strata corporation as to whether a transfer of liability exists in how the bylaws are written for your strata. This could mean that you are 100% financially responsible for payment of the strata’s deductible if the loss originates within your unit.

Unless you have sufficient coverage under “Condo Deductible Assessment” you may find yourself feeling a little financially drained after you have to shell out the cash to pay the strata’s deductible for the water damage. It should be noted that these deductibles can be as high as $250,000 in some condo buildings, and as previously mentioned if the loss originates in your unit you could be held liable for the entire amount.

As a condo owner, you can protect yourself by:

  1. Requesting a current copy of your Strata’s insurance policy. Give the Strata policy documents to your insurance broker for review.
  2. Work with your broker to ensure you have sufficient Condo Deductible Assessment coverage. Generally speaking, this coverage is not expensive. Some condo policies may automatically include some coverage, but it is still imperative to ensure the limits are adequate!
  3. Be aware of the fact that even if you have your unit rented to a tenant, you still may be held accountable for the strata water damage deductible.
  4. Stay on top of changes to your Strata’s insurance policy and or changes in how the bylaws are written for your Strata. If an increase in water damage deductibles is going to take place for your strata, talk to your broker and purchase additional coverage before the increase takes place.
  5. You may wish to purchase slightly more coverage than the minimum levels required, in case you are not informed of or miss the memo as to an increase in the Strata’s water damage deductibles.

At the end of the day, there are lots of talented insurance brokers and brokerages in the Okanagan. Find one you feel comfortable with and be sure to ask them any questions you may have regarding your Condo or Strata’s insurance.


*This column is intended for entertainment/informative purposes only and is not intended to act as a substitute for seeking the advice of a licensed Insurance Broker or other qualified professional. Coverage is subject to the policy terms, conditions and exclusions – please refer to policy documents– specific circumstances may alter the availability of coverage.

Read more Kris' Insurance Corner articles


About the Author

Kris Sotiros is a licensed Insurance Advisor with Sea to Ski Insurance Services.

Kris graduated from a scholarship to the British Columbia Institute of Technology, has completed the Canadian Securities and Conduct and Practices Handbook Courses, and is currently completing the Canadian Accredited Insurance Broker (CAIB) designation. Kris is a member of the Insurance Broker's Association of British Columbia and Lake Okanagan Insurance Society.

Contact Kris today for a complimentary no obligation commercial or residential insurance review. Kris believes in providing his clients with high levels of service and competitive pricing, while helping families and businesses minimize their financial exposure to life’s uncertainties.

Kris can be reached directly: 250-870-6265

Email: [email protected]

Toll Free: 1-877-732-2754 Fax: 250-707-2101

The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet presents its columns "as is" and does not warrant the contents.

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