Insurance

February 2, 2026 Published by North Alberta Chapter - By Hamish Farmer

Insurance Needs – Residential Condominium Living

What Are My Insurance Needs?

What Are My Insurance Needs?

Disclaimer: This article provides general information only. Each condominium unit owner and tenant has unique insurance needs. Please consult a licensed insurance broker to ensure you have the appropriate coverage for your situation.

Condominium, Condo, or Apartment? Let’s Clear Up the Terminology

Many people use the term condo to describe any apartment-style home, whether it’s a registered condominium or a rental building owned by a landlord. However, the distinction matters.

A registered condominium can take many forms: High-rises, walk-ups, townhomes, duplexes, and row houses can all be condominiums if the individual units are owned. If the property is registered as a Condominium Corporation, it is governed by provincial condominium legislation, including the Condominium Act and its regulations.

If the building is fully owned by a landlord and rented or leased to tenants, it is not a condominium. Understanding this difference is the first step to understanding your insurance needs.

Insurance Needs for Unit Owners

Most condo unit owners contribute to their community by attending the annual general meeting and reviewing the corporation’s insurance documents. However, many mistakenly believe the Condominium Corporation’s insurance policy covers their personal belongings or personal liability. It does not.

Regardless of whether you live in your unit or rent it out, you must ensure your personal insurance policy protects your property and liability. If you haven’t reviewed your policy recently, consider reaching out to your broker.

A Note About Bylaws and Building Coverage
Responsibility for insuring the building structure is determined by the Condominium Corporation’s bylaws. Always review them carefully. If anything is unclear, consult an experienced condominium lawyer (check out the CCI business directory for a list of lawyers who are also CCI members).

1. Personal Property Coverage

A unit owner’s policy covers the contents you bring into your unit or keep in on-site storage:

• Furniture
• Electronics
• Clothing
• Other personal belongings
• In some cases, provided appliances such as washers, dryers, fridges, and stoves

2. Additional Living Expenses (ALE)

If a fire, water loss, or other insured event makes your unit uninhabitable, ALE helps cover the additional costs of temporary accommodation and related expenses.

For investment properties, ALE can provide coverage for lost rental income if a tenant must vacate during repairs.

3. Betterments and Improvements

Many owners upgrade their units—new flooring, countertops, cabinets, and more. Whether you must insure these upgrades depends on the corporation’s bylaws. If you’re uncertain, consult the Board or obtain a legal opinion.

4. Deductible Assessment Coverage

Since January 1, 2020, Condominium Boards may recover up to the lesser of the Corporation’s deductible or $50,000 from a unit owner for damages originating within their unit—even without proof of negligence.

Condo deductibles can range from $1,000 to $50,000. Your personal policy must have enough deductible assessment coverage to match the Corporation’s highest deductible (up to $50,000).

5. Unit Additional Protection (Contingency Coverage)

This coverage applies if the Corporation:

• Has no insurance,
• Has inadequate insurance, or
• Its insurance does not respond to a loss.

Your personal policy may help cover repairs to your unit in these cases.

6. Common Elements Loss Assessment

If the Corporation issues a special assessment due to an insured loss affecting common elements, your policy may cover your share, provided the assessment is valid under the governing documents.

7. Personal Liability

Your policy covers you if you accidentally cause:

• Property damage
• Bodily injury

This can apply in your unit, in common spaces, or even away from home.

If You Rent Out Your Unit

Ensure your tenant carries their own insurance policy. This protects:

• You, by allowing recovery from their insurer if the tenant causes damage
• Them, by covering their belongings and liability

Without insurance, a tenant who causes a loss could face significant out-of-pocket costs and potential legal action. Tenant insurance is inexpensive and essential.

Insurance Needs of Tenants

Tenants often take pride in their homes and work with owners to maintain a safe environment. While the landlord or condo unit owner insures the building, tenants are responsible for insuring their own belongings, liability, and additional living expenses.

1. Personal Property

Tenant insurance covers:

• Furniture
• Clothing
• Electronics
• Other belongings
• Items stored in on-site lockers
• Belongings temporarily removed from the premises (e.g., while travelling)

Most policies include Replacement Cost coverage.

2. Additional Living Expenses

Tenant insurance covers:

If an insured loss makes a rental unit unfit for occupancy, ALE covers the additional costs of temporary accommodation. Even if the tenant is not at fault, they may need to relocate during repairs.

3. Personal Liability

Tenant insurance provides coverage for accidental:

• Damage to the landlord’s building or property
• Damage to neighbouring units
• Bodily injury to others

For example, a small kitchen fire can lead to smoke and soot damage throughout multiple units, resulting in costly claims.

4. Tenant’s Legal Liability

Tenant insurance covers:

This coverage helps pay for accidental damage caused directly to the rental unit the tenant occupies.

Final Thoughts

While the insurance needs of unit owners and tenants differ, one thing is consistent: Speaking with an experienced insurance broker is essential to ensure proper protection.

Thanks for reading, and take care!

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Hamish Farmer, BA, serves as Vice President and Client Executive for the Real Estate Division at BFL Canada Hamish can be reached at hfarmer@bflcanada.ca.