Dear Tony: After the recent rains, my townhouse and those of two neighbours all suffered significant damage from water entering our rear patio areas. Our townhouses on the North Shore face the hillside and an errant stream developed into our yards and subsequently our homes.
There is insurance in place for the strata corporation; however, the council decided they would not file an insurance claim and the property manager advised we were to file claims on each of our policies. The strata council informed us the damages were not sufficient for a claim, but the deductible is only $25,000 and restoration costs will easily exceed that amount.
Our personal insurance providers have advised us this is a strata claim, not a homeowner claim. How is a claim value determined? Who decides whether a claim is filed? Can the strata council deny the claim?
Pauline J.
Strata corporations are becoming more reluctant to file claims with the fear the deductibles and policy costs will escalate, but this is not grounds to deny a claim. The damages and costs are evaluated by the adjuster appointed by the insurance providers. Once the insured damages are determined and a claim is established the restoration process is approved. In this situation, if the amount, which includes all 3 units, is above the deductible, the strata corporation insurance covers the claim and the deductible is a common expense of the corporation.
Under the Strata Property Act, a strata corporation must obtain and maintain property insurance on common property, common assets, buildings shown on the strata plan, and fixtures built or installed on a strata lot, if the fixtures are built or installed by the owner developer as part of the original construction on the strata lot. The property insurance must be on the basis of full replacement value and include the perils of fire, lightning, smoke, windstorm, hail, explosion, water escape, strikes, riots or civil commotion, impact by aircraft and vehicles, vandalism and malicious acts.
Despite the terms of the insurance policy, named insureds in a strata corporation’s insurance policy include the strata corporation, the owners and tenants from time to time of the strata lots shown on the strata plan, and the persons who normally occupy the strata lots. As an owner, you are a named insured and may file your claim directly with the insurance provider. Contact the broker and start a claim.
Strata council tip: Whenever there is a loss, injury or damages, immediately mitigate the cause and damages and immediately contact the strata corporation insurance provider. A delay in emergency restoration will only increase the damages and value of a claim. A close working relationship with your insurance broker is critical.
Tony Gioventu is executive director of the Condominium Home Owners Association
