VANCOUVER (NEWS 1130) – With strata insurance rates skyrocketing across the Lower Mainland, there are calls for the province to step in and provide an affordable alternative.
Rates for condo owners have been rising rapidly, with property owners having to pay special levies totalling in the thousands of dollars and also bracing for monthly fee bumps of hundreds of dollars.
With stratas scrambling to address the overnight jump in insurance rates — if they can even get coverage — Metro Vancouver Chair Sav Dhaliwal said the B.C. government needs to do something to address the issue.
“So why not have a crown corporation, such as ICBC, to take on this also as another division of insurance?” he suggested. “And of course, as ICBC, which generally the concept is: do not make money for governments or anything like that, is to basically serve the consumers.”
He said that could give people a little piece of mind, stressing the value of a Crown corporation aimed at providing a service, and not motivated by profit in the way that private insurers operate.
“ICBC, their business model should be to break even,” he told NEWS 1130, adding insurance rates could vary for renters and property owners. “Protect the consumer in terms of making sure that there’s some stability, and number two, that it’s the actual real cost of that product.”
It's time for the province to step in & provide an affordable alternative to private home insurance. We hear that view from Metro Vancouver chair @BurnabySav, with stratas scrambling to address soaring condo insurance costs through special levies & hiked fees. More @NEWS1130
— Martin MacMahon (@martinmacmahon) February 21, 2020
Meanwhile, Dhaliwal said insurance, in his belief, “is not a luxury, it’s a necessity,” that provides peace of mind and quells some concerns around financial security.
“It’s also, more lately, it’s housing affordability for many, many, hundreds — if not thousands — of families who are barely making a rent payment. Whether they own it or they rent it, ultimately it comes down to paying who lives there as a renter or a homeowner.”
He said any increase in strata insurance rates could prove to be difficult for anyone to afford, again pointing out the costs trickle down to renters even if they aren’t the ones directly paying strata fees.
Dhaliwal, who is also a city councillor in Burnaby, noted at the municipal level, there’s nothing he nor the city can do about rising rates.
In an email to NEWS 1130, the Ministry of Finance said specific product pricing is a matter for the industry, but noted the province has “asked the British Columbia Financial Service Authority to monitor the situation carefully.”
“We encourage all stratas that are having difficulties getting insurance coverage to contact the Insurance Bureau of Canada,” the ministry said. “Strata corporations can also reduce the possibility of insurance claims by having depreciation reports and following preventative maintenance programs.”
It said the issue of rising insurance costs is one that strata corporations have been dealing with across Canada, as well as around the world, but that “higher real estate prices and construction costs have contributed to a surge in the cost of insurance coverage.”
It cited climate change and increased weather-related events as also factors on the cost of rates.