Since every strata is unique, there is a lot to consider when purchasing strata insurance and many different packages are available.
Per the Strata Property Act, strata corporations must obtain both property and liability insurance. However, it’s not enough to simply purchase these coverages. Strata corporations must ensure that their coverage meets the following minimum standards:
Strata corporations must acquire property insurance that covers the full replacement value of key items and insures against major perils. Per the Strata Property Act, corporations must account for major perils, including fire, lightning, smoke, wind, hail, explosions, water, strikes, riots or civil commotion, damage caused by aircraft and vehicles, vandalism and malicious acts.
Strata corporations are required to secure a minimum of $2 million in liability insurance to protect against bodily injury and property damage claims.
While the Strata Property Act outlines insurance requirements for property and liability coverage, strata corporations are advised to consider several other forms of insurance.
While directors and officers (D&O) insurance is optional under the Strata Property Act, this coverage is a necessity for the majority of strata corporations. D&O insurance protects strata council members against liabilities for errors and omissions made in the performance of their duties as council members. This is important, as strata council members are held to the same standard of care as directors of companies and non-profit organizations.
Earthquake insurance is not explicitly listed as required coverage under the Strata Property Act. However, this type of insurance is particularly important for strata corporations that operate in earthquake-prone areas of B.C.
The Strata Property Act does not account for overland flooding. However, water damage is a leading cause of insurance claims for strata corporations. In fact, water damage from overland floods has the potential to affect multiple strata units at once, leading to complex and costly repairs.
In addition to the policies listed above, there are a number of other supplementary coverage options to consider. Depending on a strata corporation’s needs and exposures, they may want to ask about the following:
To learn more about our Schill Strata Shield Insurance, contact us today.