Do not purchase or renew homeowner or strata policies online warns Tony Gioventu
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Dear Tony:
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I read a recent column you wrote regarding the issue of earthquake deductible insurance. I have recently talked with two insurance agencies and both wanted to know whether our strata had decided upon the deductible insurance responsibility of each unit being a) strictly divided by number of units in the complex or b) determined by square footage of each particular unit.
Who decides the method of deciding who is responsible for what portion? I have ended up overpaying in order to go higher in my insured amount for fear of being underinsured. I am on a pension and $10 a month more means a lot to me. If I don’t do this, am I going to pay too little and end up under-insured?
I don’t understand why it is not stipulated how the financial responsibility will be calculated. Doesn’t that leave the decision to the insurer? How do I know how much to pay when I don’t know exactly how much I need to be responsible for? And why are insurance companies wanting this information when you are saying we are not supposed to take part in that aspect?
— Janet W.
Dear Janet:
Your insurance agents/agencies are incorrect in their request. This is not subject to a decision of a strata corporation. An insurance deductible is deemed to be a common expense of the strata corporation under the Strata Property Act. Common expenses are divided among the strata lots based on the unit entitlement filed in the Land Title Registry.
For pre-2000 strata corporations the schedule is on the strata plan. After July 1, 2000, the schedule is a separate form that is filed in Land Titles as a form V for Building strata corporations and Form W for Bare Land strata corporations.
Unless a strata corporation has passed a unanimous vote to amend the schedules, which is extremely rare, the filed schedule or amendments apply to all common expenses. There are many variations and types of strata corporations across British Columbia. Make no assumptions. Obtain your filed land title documents.
Insurance deductibles, and specifically earthquake deductibles, are applied in the same manner strata fees are calculated. When you are shopping for your homeowner strata policy, provide a copy of your annual insurance report/summary from the strata corporation to your broker.
To calculate your estimated share, apply the unit entitlement model. Take your unit entitlement, divide by the total unit entitlement on the schedule and this produces your percentage share of a claim.
Earthquake is based on the full replacement insurance value of your strata corporation. This is obtained through routine independent appraisals. If the earthquake deductible is 15 per cent of the value, apply your percentage share to that amount and it gives you the estimate of your deductible.
Policies may have conditions, limitations or exclusions based on building status, claims history and location.
Do not purchase or renew homeowner or strata policies online. Contact your insurance broker and confirm the details of your policy. If in doubt, insist on written confirmation.
I would not rely on any AI application to assist with the procurement or interpretation of insurance for strata corporations.