How to Purchase Strata Insurance in BC | Price, Capacity & Competition | Earthquake, Flood & Fire

In this webinar, Steve Pearce of Seafirst Insurance explains the strata insurance market in BC including factors that affect price and capacity (availability), environmental influences such as wildfires and floods, earthquake rating, deductibles, getting quotes, and best practices for maintenance and risk management to give strata corporations a better chance for coverage.

0:00 Introduction: price, capacity and competition
2:56 Insurance capacity: domestic market, Lloyd's syndicates, cover holders, and wholesalers have strict criteria and capacity (how much insurance they can provide in a region)
7:06 Getting multiple quotes: in current market conditions not all brokers are able to get quotes depending on your strata
12:21 Capacity: total insurable value: easier to find a quote for lower replacement values
13:32 Capacity: Risks: location, building height, liability risks, and claims history
18:49 Capacity: earthquake zones and share (deductibles)
23:11 Location: risk of flooding, types of floods
26:45 Location: risk of wildfire, fire underwriter survey codes, FireSmart
32:21 Insurance is a transfer of risk to the insurer
33:34 Factors affecting rising cost of insurance and deductibles: skyrocketing rebuilding costs, changes to Building Code
35:39 What your strata can do: depreciation reports, building maintenance, compliance with Strata Property Act, and more

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Excerpts:
So, what can you do? We're always asked how can we help keep pricing down? How can we help keep rating down? That's what we can help is rating. The pricing there's a whole bunch of influences there that we have no control over such as the inflation, the cost of labour, cost of materials, different building bylaws (new Building Code)...how many different cities are going to bring that into the requirement if there's a total loss. And what does the replacement look like? On an appraisal do they take that into account? We won't know for the next probably year and a half.

But the other thing that we can look at though is depreciation reports. This is the number one area that insurers love to hear good storeys about. How well prepared financially, strategically planned, as well as risk management, upgrades and maintenance are done to the building. Share everything with your broker. If you repainted lines, if you had the storm drains cleaned out, if you have someone who goes up and cleans, if you have a flat roof and you have someone that once a month from the end of summer to spring, goes up there and cleans the drains, let us know as brokers. Because we put that into the file. That matters. Every type of inspection you have done, a roof inspection. You never know what can happen especially you have trees around something stabs through the roof. Electrical inspections in a timely manner, plumbing inspections, anything just to stay on top of it...

And then you want to be able to demonstrate that you do that with long-term stability and proactive approach to the building maintenance which will put your building in the best light and the best position for risk assessment and for rating and insurance. The other thing is having a very clear communication between strata council responsibility and unit owners’ responsibility during claims, during maintenance, whatever it may be. Make sure you're not intervening (contravening) the Strata Property Act. Make sure that it's a strata lawyer that you're dealing with that helps you with bylaw reviews, are doing that. Ensure your strata is meeting regulatory requirements and that building inspection reports and recommendations are reflected in the maintenance programs, repair plan as I had said earlier anything that may pose a risk such as roofing, water lines, electrical, and drainage systems. If you stay on top of that insurance companies love it. It's a great story to tell.