Sean, its Dan. I’m one of the unit owners
of the strata that you insure and I just got a letter from the strata council about needing
to buy more earthquake deductible coverage? Does that make any sense to you?
Yeah yeah, it sure does Dan. It sounds like the strata is probably referring to loss assessment
coverage. This coverage will protect you in the event that you have some kind of a deductible
assessed against you by the strata. With the way that earthquake rates and deductibles
have been increasing on Vancouver Island, I’m not surprised they sent you a letter to
say that you need to make sure that you have enough coverage.
Ok, I think that makes sense. So, how much coverage do I need then?
Oh, ok, well the best way to figure that out is to look at your Form 1 or your Form V.
I see that the building limit is $5 million and your earthquake deductible is 10%. So
your overall earthquake deductible for the strata would be $500,000. You just have to
apply whatever percentage of ownership you have to that strata deductible and you’ll
get exactly how much coverage that you need. Now, make sure though, when you’re talking
to your broker about adding loss assessment coverage that you confirm a few things. First
of all, you should make sure that the policy is going to cover deductibles that are assessed
against you. Especially for earthquakes because there are some policies out there that will
not cover earthquake deductibles. Also make sure that there are no other requirements,
restrictions or sub-limits on the policy. And if there is a sub-limit, make sure that
you can purchase additional limits to get you up to $25,000.
Sean, I’m pretty sure that answers all my questions. Thank you for your time, I appreciate
the help. Well I’m happy to help!