Many British Columbia Residence is facing another problem this year, which is the surge in strata insurance premium. Early 2020, a report says a one year old 26-storey apartment in Abbotsford received quote of $588,000 compared to $66,000 last year. A 780% increase in insurance premium. Another case in Langley where the insurance deductible jumped from $5,000 to $25,000.
We continue to receive reports about substantial surge in insurance premium throughout the year of 2020. The increase averaged between 50%-300% in British Columbia. Insurance companies claim that the hike was due to natural occurrences and nobody is willing to underwrite at a lower cost. This shouldn’t impact British Columbia as it has always been and did not experience natural disaster in recent years. It is absurd that a one-year old building should be hit with a 780% increase.
Under the B.C. Strata Property Act, it is mandatory for strata to purchase full building insurance. The additional cost would mean approximately $200-$500 increase on monthly strata fee. The cost is too much for residence to bare.
B.C Liberal proposed the Strata Property Amendment Act:
- Add a new "standard unit" definition to better clarify the responsibilities of strata building insurers versus individual unit owners.
- Require a strata corporation to provide a copy of proof of insurance so that buyers know the terms, premiums, amounts of deductible and coverage limits.
- Property and insurance renewal terms be provided at least 30 days in advance to give strata corporations more notice of any impending increases.
- Require unit owners to buy liability insurance to make sure individuals are able to cover the costs of a major water leak, for example, since strata insurance only covers common areas.
Although they’re also looking into financial incentive for strata building maintenance, the proposed bill doesn’t solve the issue rather give more time to adjust and pass the cost to individual owner. We will need bills to cap the rate or discussion with private insurance companies to make the insurance reasonable. Vancouver is already one of the most expensive cities to live in. The cost will likely be passed to those who rents and barely making a living.