→ argue that a water heater that is in an unfinished basement, beside a drain, is not an issue; however, at present, insurers are not distinguishing between basement or main floor, they just want them replaced at 12 years of age, definitely before 15 years. Insurance companies are driven by statistics and while your corporation may not be experiencing losses due to age, insurers have mountains of statistics that show otherwise. Again updating can only benefit you in the long run. Get R Done . Technology has enabled us to do more and faster....so why are we always behind? As I am writing this, I am realizing why. The renewal process should start 60 days prior to renewal and usually does. So why is the policy often late? When asked for renewal information, provide it right away. The renewal process typically has the broker requesting information from the property manager, the property manager sends to the board who completes and signs what is needed, then back to the property manager, to the broker, to the insurer. The insurer offers terms to broker, broker advises property manager and terms are accepted then broker advises the insurer to issue. (often the offer and acceptance is skipped if it is known that we won't find better terms) NOTE: In order to speed the process, the broker may ask for terms based on no changes and provide signed documents prior to renewal. Everyone is often inundated and with the renewal process going through so many hands, no wonder it takes so long. When asked to provide information, do it right away. This will help move the process along. Understanding Condominium Insurance – Terminology [from the Ontario’s Residential Condominium Buyers’ Guide https://www.condoauthorityontario.ca/resources/condo- buyers-guide/ Condo Insurance: Under the Condo Act, condo corporations are required to obtain and maintain both property insurance and liability insurance. Liability Insurance : Under section 102 the Condo Act, condo corporations are required to obtain and maintain insurance against the liability resulting from a breach of duty as the occupier of the condo corporation ’ s common elements or certain land as well as insurance against liability arising from the ownership and use of boilers, machinery, pressure vessels and motor vehicles.
Property Insurance : Section 99 (1) of the Condo Act requires condo corporations to obtain and maintain insurance for damage to the units and common elements that is caused by certain major perils, including fire, smoke, lightning, windstorm, hail, or any other peril specified in the condo corporation ’ s declaration or by - laws. Standard Unit : A condo corporation ’ s obligation to insure the units does not cover “ improvements ” made to units. Section 99 of the Condo Act states a condo corporation ’ s obligation to insure against damage to units from major or other perils only includes what is called a “ standard unit ”. What constitutes a standard unit in your condo corporation is important as it not only outlines responsibility for property insurance coverage but also partly determines what the condo corporation or the condo owner is responsible for when dealing with repairs after damage. For more information on where to find your condo corporation ’ s definition of a standard unit, see section 3.5 of this Condo Guide - Living in Units and Using Common Elements. Deductibles: According to section 105 (1) of the Condo Act, if an insurance policy obtained by the condo corporation has a deductible clause that limits the amount payable by the insurer, the condo corporation is responsible for paying the portion of a loss that is excluded from coverage, and that amount must be included in the common expenses. A single owner may be responsible for paying a deductible if a claim to the condo corporation ’ s insurer arose due to the owner ’ s (among others) action or inaction. In this case, the lesser of the deductible limit or the actual cost of the repairs must be charged back to that owner ’ s unit. For more information on chargebacks, please see section 3.4 of this Condo Guide. Your condo corporation may also have an insurance deductible by - law that would extend the circumstances in which an owner would be responsible for paying for a property insurance deductible. Common examples of extended circumstances could include: • Where the owner, occupant, or guest of the unit, through an act or negligence causes the insured damage; and/or
• Where the insured damage is caused by accident (i.e., where no one is at fault).
Education sharing on insurance with your owners is important. There have been articles in previous issues and we will share some methods of successes in our next issue that you might emulate in your community. ■
CCI Review 2021/2022 – 4 —May 2022 Page 19
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