1. CONDOMINIUM OWNERS FORUM
SYMPOSIUM 2018
INSURANCE Q&A
Paul VanderHooft – Insurance Brokers Association of Alberta (IBAA)

2. INTRODUCTION IBAA – Insurance Brokers Association of Alberta
Who are we?
What do we do?
Paul VanderHooft, B.Comm, CIP, CAIB
Who am I?
What do I do?

3. Q&A SESSION What do I need to know about condo insurance?
As a condo board member?
Bylaws, Bylaws, Bylaws
What type of condo complex do we have?
Bare Land Condominiums
Standard Condominiums
As a condo unit owner?
What type of condo unit have I purchased?
Homeowner vs Condo Unit Owner Insurance
Unit Holder Improvements – who insures these?
Special Assessments – How does insurance coverage respond?

4. Q&A SESSION
What are the minimum insurance requirements for a condominium community (corporation)?
Property Coverage
Named Perils Insurance vs Broad (all risk) Perils Insurance
Additional Perils
Sewer Backup, Flood, Earthquake
Equipment Breakdown
Additional Coverages & Extensions
Crime Coverage
Liability Coverage (CGL, Automobile, D&O, Environmental)

5. Q&A SESSION
How much money should be in a reserve fund to satisfy insurance providers?
Reserve fund study
Reserve fund should be fully funded to meet requirements laid out in the study
Insurance providers are becoming increasingly aware of the importance of fully funded reserve funds
Maintenance issues
Liability of directors & officers

6. Q&A SESSION
Should condominium corporations have contingency funds for items outside of planned replacements?
Yes
Items that are near deductible thresholds should not be pushed through as insurance claims.
Example: Burst water pipe causes $15,000 in damages to condominium common areas. Water damage deductible is $10,000.
Have any other claims been made during the policy period? Will underwriters be considering claims frequency in setting rates for the renewal term ahead?
Exceptions:
Property claims requiring proper cleanup to prevent future issues such as mould
Liability claims involving injuries

7. Q&A SESSION
Is it recommended to have your Unit Holder Policy with the same insurance company as the Condominium Corporation?
Not necessarily
First and foremost, your unit holder policy should be the policy that best covers your own needs.
Not all insurance companies provide coverage for both condominium complexes and individual unit holders
Insurance companies do not like to have too high a concentration of insured values all in one location. As such, you might not be able to get insurance for your unit with the same company that is insuring the building(s)

8. Q&A SESSION
If flooding occurs in a unit above mine causing damage to my unit and/or my belongings, what is our recourse?
Make claim against your own unit holder policy
Coverage under your own policy is typically for replacement cost coverage on both contents and unit improvements
Coverage under the liability portion of someone else’s policy is usually limited to depreciated actual cash value
Let your insurance adjusters work to hold the other parties (condo corp, property management firm, restoration contractor, etc) accountable for timeliness
You may lose your claim free discount but it is generally far more productive to let the claims professionals handle the claim for you

9. Q&A SESSION
Please comment on catastrophic condo losses and the probability of them being difficult to settle?
Condominium claims are some of the most difficult property claims to settle
Catastrophic losses will involve almost all unit holders, numerous insurance companies, the board of directors and a multitude of contractors. Potential for litigation can also add to the amount of time it takes to settle
Composition of Board of Directors
Well-meaning volunteers vs carefully selected individuals with certain skills
Board succession planning vs fingers-crossed approach

10. Q&A SESSION
How will (or is) insurance for condominiums affected by climate change?
No one can deny that severe weather is happening with increased frequency
Storm activity is increasing – localized flooding, hail storms, high wind events
Increased periods of dryness and high temperature is increasing wildfire risks
Building methods and materials used are not necessarily resistant to these exposures (i.e. vinyl siding, shingle roofs)
Higher claim frequency & higher damage values mean increased insurance premiums

11. Q&A SESSION
What is the impact of cannabis plant growing on insurance policies?
Presently, growing cannabis plants is illegal and insurance policies are not responding to cover damages that are the result of illegal activites;
October 17, 2018 it will be come legal to possess up to 3 cannabis plants to grow cannabis for personal consumption;
Insurance wordings will adapt to clarify what will be covered and what will not be – scenarios falling outside what has been legalized will likely still be excluded from coverage
The industry is in early days and it is likely to early to be definitive on how this will play out

12. Q&A SESSION Paul VanderHooft, B.Comm, CIP, CAIB
Thank you!
Paul VanderHooft, B.Comm, CIP, CAIB
President – IBAA (Insurance Brokers Association of Alberta)
Manager – Commercial Lines (Westland Insurance Group) OR