When it comes to condo insurance, understanding who pays what during a claim is key to being properly protected. The homeowners’ association’s insurance covers the building, common areas, and its civil liability, while your personal insurance is designed to protect your belongings, the improvements to your unit, and your individual civil liability.

Since the rules surrounding condo insurance can be complicated, we’ve prepared this guide to help you see things more clearly.

What is the role of the homeowners’ association in home insurance?

What is covered by the association’s insurance:

• The entire building (structure, foundations, roof)
• Common areas like hallways, stairs, and elevators
• Standard items present in each unit as per the initial description
• The association’s civil liability for accidents or incidents
• Collective installations and equipment (central heating, common electrical system)
• Exterior developments belonging to the condominium
• Shared infrastructures like the swimming pool or community gym

Situations Where the Association Handles Repairs

In Quebec, the law clearly outlines the homeowners’ association’s responsibilities for repairs after a loss. The association is required to manage and pay for repairs to common areas and the standard components of private units. This duty stands even if a co-owner caused the damage.

It’s important to know that the association can legally recover the cost of the insurance deductible or other uncovered amounts from the responsible co-owner. This financially protects the condominium community as a whole.

How is the Deductible Determined?

The deductible is the amount the association must pay before its insurance policy covers the repair costs. To set this amount, several factors are taken into account, such as the building’s value, the condo’s claim history, and insurance market conditions. Co-owners should note that this amount can change from year to year.

Under the current regulations, the association can require the co-owner responsible for a loss to cover the deductible and other uninsured expenses. This helps to keep insurance costs reasonable for all residents.

What Are “Improvements”?

The description of improvements made to your private unit is a critical document in condo management. This legal requirement helps to clearly distinguish between the standard components of the building and the custom upgrades made to individual units.

Improvements can include things like high-end flooring, custom cabinets, or smart home systems. Your personal insurance covers these upgrades, as they are not typically included in the association’s policy.

We recommend carefully documenting all improvements made to your space with photos and receipts. This will help you avoid any surprises if you need to make a claim and ensures the value of your modifications is accurately established.

Why is it important to have civil liability insurance?

H3: What your condo insurance includes:

• Individual Civil Liability: Your condo insurance policy must cover damages you might cause to others or their property in your unit or elsewhere.
• Personal Property Protection: Condo home insurance protects your personal belongings against theft, water damage, fire, and other insured events up to the declared value.
• Unit Improvements: All renovations or modifications you’ve made in your condo are covered by your individual policy, not the association’s.
• Additional Living Expenses: If you have to temporarily leave your unit due to a covered claim, your policy can reimburse your accommodation costs.

How to know if you’re adequately covered

To ensure you have adequate coverage, you need to do a few checks. First, look at the limit offered by your policy: is it enough to replace all your belongings in a major loss?

The types of risks covered also deserve your attention. Situations like water damage or natural disasters may require additional protection depending on your region.

The law requires every co-owner to have civil liability insurance. This is non-negotiable and is in place to protect both you and your neighbours in case of an incident.

Why should you insure the improvements in your unit?

As a co-owner, it’s your responsibility to insure the work and modifications made to your condo. These upgrades often represent a significant value that deserves to be properly protected.

Your homeowners’ association’s insurance only covers the standard components of the building. Any personalized elements—like high-end floors, cabinets, or countertops—are not included in this common protection.

Every improvement you make increases the value of your unit. Without specific protection, you could lose these investments in the event of a claim.

Renovations made by previous owners should also be listed on your personal insurance policy, as they are now part of your property.

What factors influence your premium?

• Location: A condo in a high-risk area (for floods, earthquakes, etc.) will lead to higher premiums for certain coverages.
• Year of construction: Newer buildings that meet current standards may qualify you for better rates.
• Coverage level: The more coverage you choose, the higher the price of your policy.
• Your claims history: Insurers look at your past claims history to determine your premium.
• Deductibles: Opting for a higher deductible can lower your insurance cost.
• Safety measures: Alarm systems, smoke detectors, and sprinklers can help you save on your insurance.
• The building’s common areas: The overall condition and claims history of the entire building influence what you pay as a co-owner.

How are damages to the unit and common areas managed?

Who pays for water damage?

Here’s a comparison of responsibilities depending on the source of the water damage:

When Should You File a Claim?

You should report any claim within a reasonable timeframe, which is generally 30 days. Your insurer will ask for:

• Photos of the damage
• An inventory of the affected belongings
• Invoices for any repairs or replacements
• Any official reports related to the claim

Depending on your situation, you might find additional protections useful. You may need specific coverage for valuable items not typically covered by a standard policy.

Get your condo insurance with Sonnet!

Finding the right protection for your condo can seem complicated with all the co-ownership rules. At Sonnet, we give you peace of mind with a fully online condo insurance that is clear and tailored to your specific needs.

Get an instant quote and buy your policy immediately through our easy online platform.

Frequently Asked Questions about Condo Insurance

Who pays the deductible when a claim affects multiple units?

When a claim affects multiple units, the association’s collective insurance covers the damages after the deductible, which is a common charge distributed among all co-owners according to their share (or covered by the self-insurance fund if sufficient). The association can still recover these amounts from the responsible owner if the cause of the loss is attributable to them.

When should the value of the building be assessed?

In Quebec, evaluating the building is a legal requirement under Bill 141. This law mandates that every homeowner’s association get a professional appraisal every five years to determine the building’s actual reconstruction cost. The association must hire a certified appraiser to analyze the building’s specific features and establish its exact value.

This process ensures that the collective insurance premiums are adjusted correctly, guaranteeing adequate financial protection for all co-owners in the event of major damage.

Why insure the improvements inside my unit?

The association’s insurance only covers the standard reconstruction of your condo as defined in the declaration of co-ownership, leaving your improvements unprotected. These personal modifications like high-end floors, custom cabinets, or luxurious finishes often represent a considerable investment that you need to protect with your individual insurance.

What if a co-owner does not have insurance coverage?

In Quebec, an uninsured co-owner poses a risk to the entire condominium, as the law requires each owner to maintain valid civil liability insurance. This situation can expose all residents to unforeseen costs if this owner causes damage. The syndicate of co-ownership can sue the responsible co-owner to recover the costs incurred if fault can be proven. The importance of this protection highlights the issue of the collective financial security of the co-ownership.