In this post we will discuss both strata insurance and homeowners insurance.
Many strata lot owners believe that they do not require individual homeowners insurance for their strata lot. They think that they are insured through the strata insurance program, as they pay for it through strata fees. This is not the case.
What does the strata corporation insure?
Under section 149 of the Strata Property Act, the strata corporation has the duty to insure common property and assets. The policy of the strata corporation must cover the full replacement value of these assets which include: the building structure, doors, windows, building infrastructure such as sprinkler systems, elevators, and original fixtures installed by the developer including flooring, walls, cabinets, built in appliances, lighting, and plumbing fixtures. Strata lot owners are therefore covered for the replacement value of their structure.
What does the homeowner need to insure?
Section 161 of the Act specifically contemplates that an owner may obtain their own insurance to cover risks that are not covered under the strata policy.
- Losses to property due to perils not insured by the strata corporation and in amounts in excess of amounts insured by the strata corporation.
- Fixtures in a strata lot other then fixtures insured by the strata under section 149.
- Any improvements to fixtures referred to section 149
- Loss of rental revenue for the strata lot owner
- Liability for property damage and bodily injury, whether occurring on strata lot or common property.
In addition to the above, it is often advised by insurers that owners obtain a policy which includes deductible coverage in the amount of the strata corporation’s deductible. Under section 158 (2) of the Act, the strata corporation may sue an owner to recover the deductible if the owner is deemed to have been responsible for the claim. Many strata corporations have also adopted bylaws allowing the strata to bill the cost of the deductible back to the responsible strata lot without having to sue.
It is noted that many home owner policies, especially for vacation homes require that the home (strata lot) is inspected on a regular basis – failure to provide record of inspections could deem the home owners policy void. For more information on home inspections read visit or “Home care” section.
WRM strongly advises all strata lot owners to contact an insurance representative for advice on homeowners policies.