Deductibles to cover claims are also rising. In some cases, we’ve heard of deductibles increasing as much as $500,000. Remember that insurance doesn’t cover claims under the deductible amount. So, for example, if a plumbing incident were to cause $75,000 in water damage to a strata owner’s unit, and the strata’s deductible was $100,000, then insurance wouldn’t cover the claim. In such a scenario, the owner could have to pay for the damages out of pocket, depending on the strata’s bylaws.

Given these rising rates, strata owners should ask their strata corporation or manager for a copy of the corporation’s certificate of insurance. This document details current deductible amounts. Strata owners should show the certificate of insurance to their insurance provider and understand what their liability would be in the strata, if the insurance doesn’t cover the deductible. Strata property owners should also:

• have a unit owner’s insurance policy;
• have a policy that covers the higher deductible (insurance deductible insurance) to cover a loss in their unit; and
• understand the risk of not having enough coverage.

The Strata Property Act Part 9 requires strata buildings to be insured for full replacement value of all common property, common assets, and fixtures.

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