How to avoid big problems in small spaces
Whether a first-time home buyer or downsizing from a house, millions of Canadians are choosing to nest in smaller, but convenient and often affordable, condominiums. At first glance, condo life seems worry-free and is why many prefer this real estate option. When purchasing a condo, however, many Canadians don't consider the risks associated with non-insured damage to the unit. When purchasing a house, insurance is typically one of the first things accounted for when moving in. Unfortunately, insurance is often overlooked by condo owners, since most are unsure of what they are responsible for should any damage occur.
The following questions have been provided by insurer RSA to help new condo owners determine how much protection they have under their condo corporation's insurance policy and what they need to be aware of. Ask your realtor, lawyer or property manager the following questions for more clarity:
1. What does the condo corporation's insurance cover and, more importantly, what doesn't it cover?
2. Does the corporation's policy cover just the structure and common areas of your building or complex, or more? (e.g. damage to your unit's walls)
3. If there is major damage to your building, is it possible that you would have to make an additional contribution to cover the deductible of the condo corporation's insurance policy?
4. What is the deductible in the corporation's insurance policy?
5. Are you responsible for the full cost or repairs to another condo, or the full deductible on the corporation's policy if, for instance, your dishwasher leaked or your bathtub overflowed and damaged the unit below?
6. How is a “standard unit” defined by your condo corporation? Does it cover things like fixtures, ceilings and floors?
To find a broker who can explain the common types of condo insurance and what is right for you, you can visit the broker locator section at www.rsagroup.ca.
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