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Monthly Archives: November 2015

Laneway Houses Lead To Insurance Questions

With urban real estate costs rapidly increasing, many potential homeowners are looking for other options to offset housing costs. One option that many are considering is revitalizing the idea of the laneway house. Traditionally used for parking garages, these detached buildings were often used either as servant’s quarters or to house adult family members.

These days, many homeowners are thinking of converting their additional structures into residential buildings that they can rent out to offset the costs of their new homes. While not all cities allow for this, Vancouver issues permits for such projects and Calgary is launching a pilot project to allow it on one of their streets. But what does this mean from an insurance perspective?

As of now, most insurance companies cover laneway homes in the same way that they cover regular houses, and don’t offer a separate policy for the separate dwellings. This could prove problematic, as the laneway house will live in a legal grey area between “detached structure” and “dwelling”. Also, if the building is being rented out, a homeowner’s policy may not cover it. The safest course is to disclose the use of the laneway building to your broker or agent, and have him or her ensure that your insurance needs are properly addressed.

Certainly the appeal of a laneway house is not lost on many residents, and while cities start to consider the idea, it wouldn’t be a surprise to see this be an issue that insurance companies take a look at.

Will Ontario Bill 106 Change Condo Insurance Claims?

When it comes to insurance, condominiums can be a tricky issue. With the unit ownership and building ownership being separate, who is responsible for paying for damage, is often a debatable subject. Or, even more accurately, whose insurance is responsible.

Tabled last April, Ontario Bill 106 aims to clarify such confusion with updated rules and requirements relating to insurance when damage occurs to a unit or the building. This will include creating a definition of a standard unit. Bill 106 is also known as the “Protecting Condominium Owners Act”.

The province stated in a note explaining Bill 106: “If the owner causes damage to a unit, the common elements or any assets of a corporation, an amount, up to a maximum of the corporation’s insurance deductible, is added to the contribution to the common expenses payable by the owner, subject only to a declaration amendment.”

Between owners, building managers and condo boards, there are a lot of voices involved whenever damage is done to a condominium. Hopefully Bill 106 can help to clarify condominium insurance claims in Ontario. Amendments to condominium legislation in other provinces may also follow this initiative in due course.