Strata living continues to grow in popularity across B.C., offering convenience, shared amenities, and a sense of community. But with that shared lifestyle comes shared responsibility—and few responsibilities are as important (or as complex) as strata insurance.

Whether you’re a strata council member, property manager, or curious owner, understanding the basics of strata insurance is essential. In this article, we’ll break down what B.C. strata corporations are legally required to carry, which optional coverages are worth considering, and how to avoid costly gaps in coverage.

What Is Strata Insurance?

Strata insurance is a policy taken out by the strata corporation to protect common property, buildings, and shared assets. It’s different from personal condo insurance, which is held by individual owners.

Each property is unique, and insurance needs will vary based on the type of development. That’s why working with an experienced strata insurance broker is so important.

What Does a Strata Corporation’s Insurance Typically Cover?

The strata corporation’s policy usually includes:
– The building(s) on the strata plan
– Common property like hallways, stairwells, garages, elevators, and pools
– Fixtures built during original construction (e.g., countertops, cabinets)
– Common assets like lobby furniture or gym equipment
– Liability coverage for bodily injury or property damage occurring in common areas

Meanwhile, individual unit owners are responsible for insuring:
– Personal belongings
– Upgrades or improvements (like hardwood floors or built-in shelving)
– Additional living expenses if they must vacate due to damage
– Personal liability for damage or injury they cause
– Deductible assessments from the strata’s insurance (including earthquake)

What Insurance Is Legally Required for Strata Corporations in B.C.?

Under the Strata Property Act, strata corporations in British Columbia must carry:

Property Insurance: Coverage must reflect the full replacement cost of all common property and assets, and protect against major perils such as fire, water damage, wind and hail, smoke, explosions, vandalism, and civil unrest.

Liability Insurance: The law requires at least $2 million in liability coverage, protecting the strata corporation and owners against bodily injury or property damage claims related to common areas. Many strata corporations choose to carry higher limits.

Optional (But Important) Coverages to Consider

While the above are mandated by law, several optional coverages can significantly strengthen your risk management strategy:

Directors and Officers (D&O) Insurance: Protects strata council members from personal liability related to decisions made in their official role. This is essential for governance-related protection.
Earthquake Insurance: Highly recommended in B.C. due to seismic risk. Helps protect against structural damage and financial hardship after a quake. Deductible buy-down options can also reduce out-of-pocket costs.

Boiler & Machinery Insurance: Covers sudden and accidental breakdowns of essential systems like HVAC, elevators, and electrical panels.

Cyber Insurance: Protects against cyberattacks or data breaches that compromise sensitive owner or financial information—important for strata corporations that manage records online.

Pollution Liability: Covers clean-up costs and third-party claims if hazardous materials are accidentally released during maintenance or construction work.

Legal Expense Protection: Provides access to legal advice and covers legal fees in cases of disputes over contracts, employment issues, or property damage claims.

Volunteer Accident Insurance: Offers coverage for volunteers injured while doing authorized work for the strata (e.g., gardening, painting). Typically includes age restrictions.

Standalone Glass Policy: A separate policy that covers accidental breakage of glass or windows at a lower deductible than your main property insurance.

What Happens When There’s a Claim?

If a covered loss occurs and exceeds the deductible, the strata corporation pays the deductible as a common expense. However, if the damage originates from an individual unit and that owner is found responsible, the strata may seek to recover the deductible from them.

Best practices:
– Clarify deductible processes in your bylaws
– Use reserve funds or special levies to manage deductibles
– Ensure timely reporting of incidents to both strata and personal insurers

Frequently Asked Questions (FAQ)

Q: Is earthquake insurance required for strata in B.C.?
A: No, but it’s strongly recommended due to B.C.’s seismic risk.

Q: What does D&O insurance actually cover?
A: It protects council members from legal costs if sued for decisions made in their role.

Q: Can the strata collect the deductible from an owner?
A: Yes, if the owner is responsible for the loss and it’s permitted under the bylaws.

Q: What happens if we underinsure our property?
A: You may face a co-insurance penalty, where the strata becomes liable for a portion of the loss.

Why Work with a Strata Insurance Specialist?

Managing strata insurance involves more than just checking a box. Coverage requirements change, property values fluctuate, and claim scenarios can be legally complex. Having the right insurance partner can make all the difference in protecting your building, owners, and finances.

At Schill Insurance Brokers Ltd., we specialize in supporting strata councils and property managers across B.C. Our team understands the nuances of strata insurance and works with you to ensure your coverage meets legal obligations and truly protects your community.

Ready to Review Your Strata’s Coverage?

Don’t leave your strata’s future to chance. Contact the strata insurance experts at Schill today for a personalized review of your policy and a quote tailored to your property.

Secure the right coverage for your strata – connect with one of our experts today. https://www.schillinsurance.com/strata-shield/strata-get-in-touch/