Condominium living requires insurance specialized to meet the needs of condo residents. Morison Insurance has the industry experience and knowledge to provide you with the best possible advice to look after your condo insurance. Many condominium unit owners do not realize they need their own separate condominium insurance policy in addition to insurance held by their condo association or corporation. Condominium insurance provides personal property coverage and personal liability.
Condo insurance is protection against losses or damage to your condominium, your belongings, improvements you have made and liability for damages or injury to others while in your condo. Your condo is your home so it makes sense to protect your residential investment. The cost of condo insurance in Ontario can be as little as $30 a month (before taxes). Note that policy prices will vary depending on what you are insuring. Generally the more you are insuring, the higher the cost. A condo insurance policy is a wise investment in the protection of your condominium home.
Condominium refers to a type of ownership, not a style of construction, notes the Canada Mortgage and Housing Corporation. Most often condominium means homes in high-rises or multiple-unit complexes where the owner owns the unit only. There are, however, other types of condos such as low-rise developments, townhouse complexes, and homes that are stacked, side-by-side or positioned separately. These are sometimes referred to as freehold condominiums and the owner owns the house and the land it is located on.
Condo insurance can be complicated. You need to know what type of insurance you require. Do you own your unit? Do you own your home and the property it sits on?
The best advice is to first speak to your condominium corporation representatives to know what kind of insurance policy you need. Do you own your house and the land it sits on? Do you own your unit only? Once you know this, an insurance broker can provide expert advice on what insurance you should have to meet your specific needs.
If you have a freehold condo where you own your home and your property that it sits on, you likely require homeowners’ insurance. This is because homeowners’ insurance covers your home and property. Note that in a freehold condominium, you may still have a condominium corporation that will have insurance for shared premises such as parking lots.
When you own a condo unit in a high-rise or multiple-unit building, the condominium corporation (sometimes called a homeowners’ association) which manages the building will have commercial condo insurance for the building and common areas. As a unit owner, you and the other condominium owners are considered policyholders of the corporation’s condo insurance policy. You pay for this insurance through your monthly fees.
It is important to know that the corporation’s policy does not provide insurance for your condo unit. To insure your unit, you will want to have a personal condo insurance policy. This insures your condo unit from the wall studs inward.
This article focuses on condo insurance for owned units in high-rises or multiple-unit buildings, not freehold ownership condos.
Regardless, we advise that your first step when looking into condominium insurance is to speak to the condo corporation to find out what kind of insurance you need. After this, an insurance broker will guide you through getting insurance.
There are a lot of terms, coverages, limits, enhancements and exclusions that may make condo insurance confusing and a hassle. The best advice is to speak to an insurance broker. An insurance broker will make the process quick and easy. They will explain insurance options and provide expert advice.
Think about what you need to insure. You should insure the unit in case of damages such as fire and theft and other perils. Do you have expensive jewellery? An expensive bike? Do you want extra coverage for art? What is the value of your belongings? How much personal liability coverage should you have?
No, the condominium corporation’s insurance does not cover your personal insurance needs as a condo owner. There is no coverage in the corporation’s insurance for your personal condo, what is in it or your personal third-party liability.
The condominium corporation’s insurance covers the building and common areas within the building – such as hallways, pools, fitness rooms, party rooms, elevators and other areas that may be part of the building – the roof, for example. The corporation’s insurance typically covers property losses and liability.
Your condo policy should include 'Common Elements Loss Assessments' to provide your portion of a claim should one occur.
A typical personal condominium insurance policy includes personal liability coverage. Often $1 million or $2 million in liability coverage is provided in personal condo insurance policies. It is a good idea to purchase $2 million in liability protection. The additional coverage typically costs only $10 to $20 more per year and you receive an additional $1 million in liability protection. This is a small amount to pay for vastly more coverage, especially when you consider that liability awards – which can involve lawyers and the courts - can be very expensive. More details on liability insurance are provided later in this article.
Yes, your belongings are covered by a condominium insurance policy. There are limits to the coverage provided for some items such as jewellery, art, sports equipment and other high-value items. You can purchase extra coverage - these are called endorsements - to provide insurance protection for these kinds of items to their replacement value. Be sure to talk to an insurance broker about standard coverages on condominium policies to determine if you need additional insurance to meet your lifestyle needs.
These are just a few of the important questions that you should get answers to before you purchase condo insurance. Be sure to get answers to all of your questions before you purchase. An insurance broker can help with this.
Personal liability coverage protects you in case of property damage or bodily injury to others when inside your unit. We strongly advise that you get as much liability coverage as you can afford. If a claim advances to court, where legal rulings can far exceed $1 million. In these cases, the condo owner would be required to pay for the difference between the liability coverage stipulated in the insurance policy and the amount of the court ruling. Translation: If you are found liable for $1.5 million in damage and only have $1 million in liability coverage, the condo owner (the insured) must pay the additional $500,000 out of their own pocket.
The additional cost to increase you coverage from $1 million to $2 million in liability coverage is very reasonable – usually $10 to $20 more per year. The extra liability protection you receive for this small additional cost makes additional liability coverage a wise investment.
Here are a few examples of when liability coverage can protect you financially in the event of damage or bodily injury:
A deductible is the amount you will have to pay to cover a claim before the insurance company pays for losses covered in the policy. For example, if your deductible is $1,000 and you have a loss for $3,000, you will pay your deductible of $1,000 and the insurance company will pay $2,000.
Personal belongings include items such as a washer, dryer, TV, computer, sofa, clothing and similar items possessions inside your condo. Make sure you have enough contents protection to permit you to replace these items should they be lost due to a loss. As is the case with home insurance policies, you may want to do a video of your possessions so you have a record of your personal items in your condo.
It is important to buy condo insurance to protect your home in case of a loss. Condo insurance protects your financial investment in your condominium home. It covers what is inside your unit – damage or loss to your unit, your belongings, any improvements you may have made to your condo and your personal liability.
Condo insurance is important because without insurance, if you have a loss, you will have to cover costs of the loss on your own. When you have a condominium insurance policy, the insurance company agrees to cover the costs of losses or damages specified in the policy to the limits detailed in the policy. Costs are paid after the deductible is paid by you. Often the cost of a loss can be quite high.
It’s also important to know that if you are borrowing money to buy you condo you will need to have condo insurance. Your mortgage lender will require you to have condo insurance in the process of purchasing a condo. Should any damage occur to your unit, or should you cause any accidental damage to someone else’s property in a unit nearby (due to the proximity), condo insurance will cover your damages and liabilities. Most importantly, this type of policy lets you enjoy condo living with full peace of mind.
Fast Facts on Condos: The roots of condominium living trace back to 1881, when the first eight-unit multifamily home was built in New York City. Source: Tridel website.
Condo insurance is not mandatory in Ontario. That said, there are a few reasons why condo insurance is good to have:
Fast Facts on Condos: Nearly 1.9 million Canadians lived in condos in 2016. The average value, which is the owner’s expected sale price, of condos across Canada in the same year was $367,000. Statistics Canada reported 3% were worth $1 million or more.
Getting condo insurance begins with reaching out to an insurance broker and sharing some details about your condo, your lifestyle and the amount of insurance protection you need. A broker can help you to determine how much insurance you may want to have. The broker will provide details about your condo and your insurance needs to several insurance companies to get a variety of insurance quotes for you. Not all insurance companies provide the same coverages or prices. An insurance broker will go through the insurance quotes with you and answer any questions you may have. You will then be able to choose which condominium insurance policy best meets your needs.
Fast Facts on Condos: It was reported that a total of 71,378 condo units were being built in 242 projects in the Greater Toronto Area (GTA) in the first three months of 2019. Wow!
Condo insurance covers your property and liability. Property coverage includes losses to your condo, any upgrades made to the unit and the contents. It also provides additional living expenses if you are unable to live in your condo while repairs are made following an insured loss. Liability coverage includes damages or losses to others while inside your condo regardless of whether you are present at the time of the loss or not. You are also covered for items in a locker if you have one in your condo building. This is because your locker is considered to be part of your insured unit. Below is information about some more specific insurance coverages.
Your condo corporation’s master insurance policy covers the building and common areas. It doesn’t provide coverage for any upgrades made by you or any previous owners in your unit. Betterments and improvements coverage is an important coverage included on a condo policy.
Occasionally the condo corporation may assess all of the unit owners an amount – a special assessment – to cover significant repairs to the condominium building if it has been damaged and the condo corporation insurance policy is not adequate. If that happens there is a special assessment levied on all the condo owners. The Loss Assessment endorsement is a special endorsement that is included under your Condo Policy. Your Morison Insurance broker would be happy to discuss the limit options available.
Your condo policy will also provide coverage for all of your personal belongings at your chosen limit. This includes your furniture, clothing, and electronics. Make sure to discuss with your Morison Insurance broker any special limits on contents that may be applicable.
Every policy has exclusions which condo insurance purchasers should be aware of. Common exclusions are wear and tear, maintenance and some types of water damage. It is important to know what is and what is not covered by your condo policy. An insurance broker is an expert who can help with this.
A special note about those who may be using their unit for Airbnb uses: You need to tell your broker about this use otherwise a loss may be denied by the insurance company.
Also note that if you are renting a condo or you are renting a portion of your condo to a roommate, the renter will be covered by the commercial insurance policy for the building but the renter should have tenants’ or renters’ insurance to cover their own contents. You, as a condo owner, should tell your broker if you are renting all or a portion of your premises.
Fast Facts on Condos: The average household size in condos in 2016 was 1.9 persons, according to Statistics Canada. The rate of ownership at that time was 67%.
Condo insurance typically costs about $30 per month or $360 per year before taxes. Be aware that if you have more things you want to insure, the cost will increase. Condo insurance is generally much less expensive than most home insurance policies. Some factors that come into play when determining your condo insurance premium are how much your personal possessions are worth, how old your building is and your claims history.
Below are two condominium insurance profiles with policy prices for four Ontario communities. Details are provides for general information only.
Scenario #1: Retired couple - 65 years old - $75,000 in contents - insured for 25 years - no claims – mortgage free – multi-policy discount included.
|Condo Location||Condo Insurance Price (Annually)|
|$391 plus tax|
$376 plus tax
|Hamilton, Ontario|| |
$301 plus tax
|Kitchener, Ontario|| |
$263 plus tax
Scenario #2: Two occupants – 30 years old - $75,000 in contents - no claims – one mortgage – multi-policy discount included.
|Condo Location||Condo Insurance Price (Annually)|
|Toronto, Ontario||$450 plus tax|
|Oakville, Ontario||$398 plus tax|
|Hamilton, Ontario||$410 plus tax|
|Kitchener, Ontario||$356 plus tax|
There are several ways to save on your condo insurance. Here some of the more popular ways to save:
You need enough condo insurance to cover the value of items in your unit, third-party liability coverage and repairs for losses to your unit from the wall studs in. Consider the value of your belongings. You need to insure them to their replacement value. Consider requesting $2 million in liability coverage. This will help to protect you if you are sued should someone be injured while at your premises. Consider the amount of protection you need in case of damages to your unit from perils such a fire or theft. It's important to get the advice of an insurance broker who can help you to determine how much insurance you need.
Condominium insurance is different from homeowners’ insurance in several ways. Homeowners insurance covers the home, outbuildings, property and liability. Condo insurance covers the unit, the contents and provides liability coverage.
Fast Facts on Condos: According to Wikipedia, "Condominium" is a legal term used in most provinces in Canada. In British Columbia, it is referred to as "strata title" and in Quebec, the term "divided co-property" is used, although the colloquial name remains "condominium".
The insured person pays the deductible on a condo insurance policy.
You can buy condo insurance from Morison Insurance. We are an award-winning team of insurance professionals who help many condo owners to get insurance. Your protection is our top priority. Get started today b y calling 1-800-463-8074 or by filling out the contact form on our website.
This content is written by our Morison Insurance team. It is provided for general information only. Insurance needs differ from person to person, and this article is therefore not a substitute for professional advice about your individual insurance needs which can be obtained by speaking to one of our brokers.