Condo Insurance for Canadians
Owning real estate is expensive, especially in Canada. For that reason, you may be looking for any way to cut costs. While reducing your expenses is normally a smart financial choice, you should think twice before deciding not to spend on condo insurance. Without proper coverage, you could wind up in a challenging financial position which would cost you more than a small premium. Learn more about condo insurance in Canada below.
What is condo insurance?
Condo insurance protects the homeowner from external incidents that cause damage to their property or personal belongings. The coverage has two components.
First, there’s the commercial condo insurance policy purchased by the condo board, also known as condo syndicate insurance. The commercial policy protects the overall building structure, such as the roof or exterior. Common areas, like a lobby or party room, are also protected.
Second, there’s the personal condo insurance policy that an individual condo owner purchases on their own. This insurance protects you from everything that isn’t covered in the commercial condo policy. Things like your personal belongings or structures inside your unit are protected. In addition, the personal condo insurance protects you from liability if someone sues you for damages that occurred inside your home.
Why do you need condo insurance?
Personal condo insurance policies are not mandatory by law. However, some lenders might require some form of insurance coverage as a condition of your mortgage, including condo insurance. Even if you’ve paid off your mortgage, it’s in your best interest to purchase condo insurance anyway. Otherwise, you may end up paying for damages out of pocket which can be immensely expensive.
The perception that a condo board’s commercial insurance policy offers enough individual protection is common, but inaccurate. Commercial condo policies do not act the same as home insurance policies. Every condo owner should purchase condo insurance to protect their belongings and improvements within the unit, and to protect themselves if someone claims that they are liable for damages. There are many scenarios where a commercial policy won’t protect an individual condo owner.
What does a commercial condo insurance policy cover?
Commercial condo insurance policies cover the building structure and common areas. More specifically, this includes (but is not limited to):
- Windows
- Green space
- Party rooms
- Pools
- Hallways
- Garages
- Common areas
- Electric & Plumbing
- Exterior
- Roof
What does a personal condo insurance policy cover?
Your personal condo insurance policy covers everything within your own unit including structures and personal belongings. More details can be found below.
Unit Improvements
When you purchase a condo insurance policy, it’s important to list all improvements to your unit, regardless of whether or not you paid for their construction. Otherwise, they may not be covered by your policy if damages occur. Things like new hardwood floors, granite countertops, upgraded shower heads, and surround sound speakers all count as home improvements that condo insurance can cover.
Belongings (within your unit and your locker)
Note all valuable property that you keep in your unit and locker when purchasing a condo insurance policy. You should mention any expensive jewelry, paintings, antiques, electronics, furniture, and other belongings. Your policy will protect your personal belongings from physical damage and theft.
Always look for conditions in your insurance policy. While belongings are usually protected, there could be exceptions if you rent out your property, as the risk might be perceived as higher to an insurance provider.
Liability
If someone sues you for damages that occurred inside your condo, personal condo insurance can protect you. For example, if you have a dispute with your neighbor and they claim you were responsible for damages done to their property, they can sue you. Or, if a guest hurts themselves in your unit, they could take out a lawsuit against you as well. You obviously have the option to pay for legal fees out of pocket, but this can be pricey and you’re still at risk of losing the case. Condo insurance protects you from this kind of liability.
How much does condo insurance usually cost?
Overall, condo insurance is quite affordable in Canada. Most condo insurance policies cost between $400 to $600 per year, or between $33 and $50 per month. Your policy might be more or less expensive, depending on the building’s characteristics, what you’re insuring, and perceived risk. For example, if you insured the value of approximately $500,000 in personal belongings, that might cost you more money than if you were to only insure $100,000 in personal belongings.
Does condo insurance cover appliances?
Most condo insurance policies cover appliances as these are considered a part of your unit. In some cases, you might need to purchase a more robust policy to insure everything, including appliances. Remember to read the fine print and shop around for different policies from various providers to get the best insurance for your needs.
Does condo insurance cover special assessments?
Special assessments entail the costs of unexpected incidents that a commercial policy doesn’t cover, or that a condo board simply doesn’t want to pay for, provided they have the necessary paperwork to allow for that. The condo board can pass individual unit owners a bill to cover a shared cost for a big incident, such as replacing windows. These special assessments can cost you thousands of dollars.
Not all personal condo insurance policies cover special insurance assessments. You might need to pay a higher premium to have this covered, but it’s usually worth it. Talk to your insurance broker to learn more about how you can get coverage for special assessments.
Best Condo Insurance in Canada
Finding the right condo insurance to meet your needs can feel like a struggle, especially with all the options available on the market. To help, here is a list of the best home insurance in Canada. Read below for a review and facts on each insurance company.
Belairdirect
As a Canadian company founded in Quebec, belairdirect is known to have great customer service. With insurance packages for home, auto, and travel; belairdirect offers great discount bundles on multiple insurances. With policy and claim management fully online, belairdirect has eliminated the need to call in for every little concern, while speeding up the timeframe of claims. This may be a draw back for those who want in person services but allows belairdirect to offer competitive rates and attractive discounts. Coverage options aren’t nationwide, belairdirect only offers home insurance in Alberta, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and British Columbia.
TD Insurance
TD Insurance is the insurance division of TD Bank. Being owned and operated by one of Canada’s big banks it is considered safe and reliable. TD Insurance offers basic insurance packages that cover common insurable issues, and they have Enhanced Home Protection for those who want the best coverage. Applying for home insurance online with TD Insurance will automatically earn new clients a 5% discount on their policy. This streamlined application process is a part of TD Insurance’s business model as they have no physical locations to go in and get insurance. Everything must be done over the phone or online. This could be a huge benefit for some but a draw back for others who want an in-person service experience. Reviews for TD Insurance customer service are not great, with the most common issue being how long it takes to reach a customer service agent on the phone.
RBC Insurance
RBC Insurance is backed by one of Canada’s big banks. As an existing RBC customer, it may seem like the logical choice for home insurance. Although, RBC Insurance isn’t administered by RBC bank directly. To get it, you must call an insurance agent on the phone or go to a RBC Insurance Store location. Communicating with a different division of a company is a normal experience but, in this case, RBC sold their insurance sector to Aviva in 2016. RBC still backs and advertises RBC Insurance, but Aviva oversees the administration. This somewhat confusing partnership creates small hurdles for customers, including the need to call and cancel insurance separately from mortgages, even when your mortgage is through RBC. While RBC Insurance has all the luxuries of large insurance companies, they lack the customer service Canada’s big banks are known for. Aviva does somehow mange to keep the customer satisfaction of RBC Insurance high though. They do not have Green Coverage, for energy efficient upgrades on claims, and they do not offer home sharing options for insurance.
Allstate
Allstate is one of the largest insurance companies in the US. In Canada, they only operate in 5 provinces: Alberta, Ontario, Quebec, New Brunswick, and Nova Scotia. Although, this doesn’t eliminate Allstate as a key insurance company in Canada. They offer everything you’d need and expect from a home insurance company while offering some of the best discounts for having multiple insurance packages with them. They also offer retirement age and mortgage-free discounts. With exclusive in-house agents, Allstate offers excellent and streamlined services from purchasing insurance to making claims. By not outsourcing the sale of their insurance policies to external insurance brokers, Allstate is able to provide knowledgeable and quick responses. Some of the downsides of Allstate is that they are not well reviewed online, and they do not offer green coverage.
Aviva Insurance
Aviva Insurance is an independent insurance company operating in Canada since 1999. It has grown to serve just under 1 million customers across the country. They offer great, basic packages and any add-ons you may like to include. Aviva is considered a trustworthy company with over twenty years in business. The largest concern with Aviva is the customer service, as is the concern with most insurance companies. Although, Aviva seems to fall a little behind every other company due to complaints of long processing times for claims. They do have a simple online application which could get you a quote in under five minutes.
Johnson Insurance
Founded in St. John’s, Newfoundland in 1880, Johnson Insurance led the way in Canadian insurance being the first to offer monthly payment options in 1950. In 1960, it was the first insurance company to offer bundle benefits with one monthly charge. Today, the Canadian company is owned by RSA Insurance Group, a U.K.-headquartered insurance company. With online operations in all of Canada except Nunavut, they still focus on home insurance, with most offices in the Maritime Provinces. This is the company to go to for more local roots.
The Co-operators
A fully Canadian owned and operated company, The Co-operators is a true co-operative owned by its members. It is the 5th largest insurance company in Canada. With consistent customer satisfaction, customers can make phone claims 24 hours a day, 7 days a week. The company does higher rates than other insurance companies, but the improved service may make it acceptable to some customers. Quotes are free and done online if you would like to do price comparisons. The Co-operators do not offer any additional living expenses insurance if you are making a claim and are displaced from your home.
Desjardins General Insurance
Desjardins General Insurance opened in Quebec in 1944 and has become a well-known name in the province. They now offer home insurance in Quebec, Alberta, and Ontario. While only operating in three provinces, Desjardins General Insurance manages to be the third largest insurance agency in Canada. In 2015, Desjardins General Insurance acquired State Farm Canada insurance thereby increasing their presence in the industry. They offer great home insurance packages at fair prices with increased offerings at additional costs. By having home security systems, you may be entitled to discounts on home insurance with Desjardins General Insurance. In addition, without claims, Desjardins offers increased discounts to rates. As with most insurance companies the largest customer complaint is the timeliness of customer service. Otherwise, Desjardins General Insurance is a great company with a great reputation and highly recommended as an option to at least get a quote from.
Intact Insurance
Canada’s largest operator of insurance, Intact, has over four million customers across the entire country. They have a 30-minute guarantee for claims, meaning when you call in, you will be connected to an agent and your claim will begin within 30 minutes. This is a nice touch and promises those customers who find wait times for customer service with other insurance companies a problem. While 30 minutes may not be fast, having a known and realistic timeline can bring many people comfort. Intact Insurance has one of the best ratings online for customer service and is quick to respond and resolve negative reviews and complaints. Having presence across the country, Intact does not offer all it’s insurance options in every province, which can be an issue for those looking to bundle services.
Conclusion
Owning a condo can sometimes be more desirable than a house since they’re often cheaper. Condos also offer amenities, and there’s less responsibility to unit owners with respect to dealing with maintaining the property. However, insurance is a bit trickier for condos than for houses. Make sure you are aware of the limitations of commercial condo policies, and shop around for personal condo insurance that fit your needs.
