Condo Coverage

Insurance for condos can be complex, so we’re going to help simplify it.

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How are condos insured?

As a condo unit owner, you are protected by two separate insurance policies:

Your unit owner insurance policy

When you purchase a condominium, you become the owner of a percentage of a large building. It is your responsibility to obtain your own insurance policy to protect your liability, belongings and any upgrades you make to your unit. However, you should become familiar with the overall condominium corporation insurance policy as it is an important part of your coverage as an owner of this building.

The condominium corporation insurance policy

This policy is responsible for coverage on the building, common elements, and liability of the condo corp. The corporation is also responsible for maintaining and communicating the policy coverage to all unit owners.

The condo corporation’s insurance will not cover:

  • belongings inside your unit;
  • the value of any upgrades that have been completed in the unit;
  • unit owner liability

Condo coverage at a glance

Condominium coverage typically covers your belongings, loss of use, and four coverages specific to condominiums. It includes personal liability coverage for injury or property damage that you accidently cause to others.

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Comprehensive

This type of coverage lists events that are not covered if damage occurs to your belongings and unit fixtures.

Also referred to as "Special" or "All Risk".

How it works: an example

You carry a can of paint across the room and accidentally spill it all over your upgraded hardwood flooring, an area rug, and your couch.

Comprehensive

Result
There would be coverage for your upgraded flooring, your area rug and your furniture.

Why?
Paint spillage is not specifically excluded in your policy, so you are covered for items considered part of the building, as well as contents.

What Your Broker Should Know

Your condominium corporation's by-laws and insurance policy are important to have with you. They lay out the key differences between your responsibilities as a unit owner and the condo corporation’s responsibilities.

Your broker can evaluate your condominium corporation's coverage and help you buy the best coverage for your situation.

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Condo-specific coverages

There are four types of coverages that are specific to condo insurance policies.

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Collectively Owned Condominium Property Coverage

If losses occur to a condo's common elements, you could be required to share in the costs of any repairs. This coverage will reimburse you for your share of those costs (up to a stated limit).

The loss must be a result of an event that would be covered if it had occurred to your unit.

Condominium Unit Coverage

This coverage applies when your condo corporation's insurance is not enough to cover a loss that affects your unit.

Condominium Unit Owner Improvements Coverage

This coverage ensures that any improvements made to your unit will be paid for in the event of a loss.

Example
You replaced the standard carpeted floors with more expensive hardwood. A water pipe then burst in the building hallway, flooding your unit.

Result
This coverage will ensure that your hardwood floors are replaced. While the corporation's insurance would only pay for the carpet, this coverage ensures that any additional costs are paid for.

Condominium Deductible Coverage

Like all policies, your condo corporation's insurance policy will have a deductible – in this case, for losses to the condo’s common property. This coverage will reimburse you if there is a special assessment by the condo corporation and their bylaws allow you to be assessed a portion of the condo’s deductible. This coverage applies to your own unit and can be extended to common areas.

Note that not all condo corporations allow the deductible to be assessed against the owners. In those cases, the corporation pays the deductible. Your condo policy includes a limit of $25,000 for this coverage. Review your corporation's policy with your broker to see if this limit is right for you.

Did You Know?

Typically, a condo corporation is only responsible to restore the unit to the "base" or "standard" condition, which may not cover any renovations that you or previous owners have completed. The base unit will be described by the corporation's by-laws.

Why does this matter?

Suppose a pipe bursts in the space above your ceiling and floods your unit that has newly installed, high quality hardwood flooring.

  • Are you or the corporation responsible for the space above your ceiling?
  • Whose insurance would pay for the damages?
  • Is the value for your more expensive flooring covered, or just the original (base) flooring?

To ensure you and your belongings are protected we encourage you to ask your broker about condo unit owners insurance.

Details for contents

Contents are all the items and belongings you have brought into your insured condo.

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Comprehensive

Your contents will be covered against any damage or loss that is not specifically excluded by your policy.

Commonly excluded events include:

  • Terrorism
  • War
  • Nuclear events
  • Vacancy over 30 days
  • Wear, tear or deterioration

Other Things to Consider

It is important to provide your broker with the accurate amount of money it would take to replace all of your contents.

This is because two of your coverages - Loss of Use and Additional Coverages for Condos – are set as a percentage of the value of your contents.

Calculate the value of your contents

Loss of Use

Commonly referred to as Additional Living Expenses, Loss of Use coverage is included in your policy. It pays for the potential increase in your living expenses if you are temporarily unable to live in your condo as a result of an insured event. This coverage will also respond if your condo building is evacuated due to damage to a neighbouring premises or a major insured event in your area.

Example

After a fire, you may have to pay your mortgage as well as rent for living elsewhere while repairs are completed. Our plans cover the increased costs of living until you can return to your condo.

Your Loss of Use limit is generally set using a percentage of your content Amount of Insurance. For condo owners, we typically use 100% of the Amount of Insurance for your condominium contents.

Additional coverages

Most insurance policies allow you to customize coverage for additional items such as jewellery, cottages, boats and motors, or extend certain coverages to a home-based business.

Things to consider:

  • Do you operate a business out of your home or garage?
  • Do you own a cottage?
  • Does the value of your jewellery exceed the limit offered by your policy?

Your broker is the best resource to assess your unique needs and determine which additional coverages may help protect you and your home.

When to talk to your insurance broker

The insurance policy you purchase when you first move into your home will reflect your needs at that exact time in your life. Over time, our needs change — and you should alert your broker of important updates so they can make sure you're always fully covered.

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