Insurance

June 22, 2026 Published by Toronto and Area Chapter - By Frank Palmay

What Condo Owners Should Know About Insurance (Part 2)

From the Spring 2026 issue of CCI Toronto Condovoice Magazine.

Part 1 (2025 Fall) dealt with the more basic things that condo owners should be aware of, including: allocation of risk/ responsibility between the condo corporation and condo owners, insurance deductibles, rentals, additional benefits of having an insurer on your side, subrogation matters, and the importance of using an insurance broker.

This Part explores some ways in which you might be able to reduce your condo insurance premiums and some other insurance coverage features that you should be aware of.

Monitored Alarm Discount

Insurance companies want to reduce the risk that they cover. A monitored alarm system does this (fire and burglar). The premium discount can be 5% or more.

Your condo undoubtedly has a fire alarm system. Get the particulars from management, including how it is monitored and by whom.

If you have a burglar alarm system that is monitored 24/7, find out the particulars. You may be required to provide a document (a certificate or a letter) describing the system and the monitoring.

Your insurance broker will be able to advise you, as the requirements might well vary from one insurer to another.

Condo/Auto Discount

Most insurers are anxious to get all or as much of your insurance business as they can. The discount of bundling your auto and condo coverage can range from 5% - 15%. There have been instances where the discount is as high as 45%.

Again, your insurance broker can help you make the right choice. This is especially important in this area. Auto risks are assessed separately from the condo risks and, therefore, factors including the auto insurance premium and auto underwriting factors may affect the decision whether to choose an “unbundled rate” versus a “bundled rate.

In the end, getting the best coverage for the best insurance premium should be the goal.

Home-Based Business Coverage

Many semi-retired people move to condos and continue their profession/business in some form. Since COVID, some condo owners work from home at least part-time.

Consider adding insurance coverage for inventory, equipment, sensitive documents and liability, which may not be covered (or underinsured at a minimum) to your condo policy.

This is not usually that expensive, and otherwise may be excluded from your policy.

Again, discuss it with your insurance broker.

Property in Storage

It is not unusual for those moving from a house to a condo to store furniture and other belongings in a storage unit.

Unless specifically added to your condo policy, these off-site items may not otherwise be covered.

Scheduled Items

Condo owners might not realize that condo policies have low limits for specific items such as jewelry, bicycles, money (cash), art, furs, photo equipment, and stamp, coin, or other collections.

For example, most policies will only cover $5000 for any single item of jewelry and $2000 for any bicycle. This has left a lot of unhappy people come claim time when they realize they will only get a fraction back of their $20,000 watch or engagement ring.

Consider exploring this with your broker and scheduling items separately as a rider to ensure their full value coverage.

Legal Matter Coverages

If the fire department is called to attend your unit, there may be an associated fee.

Unfortunately, identity theft is becoming more common in our digital age, where you provide your bank or credit card information in order to make purchases or to make regularly scheduled subscription or warranty payments.

Most of us are now very dependent on our computers, tablets, and smartphones for our daily lives. As in the case of identity theft, computer hacks and scams are getting more common and sophisticated. Elderly condo owners may be considered easier targets.

If coverage in these areas is important to you, discuss it with your insurance broker, who can advise you on the best way to obtain this protection through your condo policy.

Below Grade Water (Suites and Lockers)

Water damage is considered to be the single highest risk for condos. Water infiltration from other units was discussed in Part 1.

A lot of condos have their lockers below grade, and some condo units may also be located below grade. Those lockers/units may also be at risk from seepage or water infiltration.

This type of damage is generally excluded from condo policies, in which case, you might be at risk. Some policies will provide coverage if the policy includes sewer backup & overland water coverage.

If your unit or your locker is vulnerable, discuss it with your insurance broker. You may well be able to obtain coverage.

Concluding Thoughts

Reducing Risks: Before transferring the risk to your insurer, reduce the risk by, for example:

• Maintain plumbing and appliances to prevent water leaks.
• Turn off water when away for extended periods. Have someone check your unit periodically.
• Use modern alarm systems and arm them.

Insurance Brokers: Adding to what was discussed in Part 1, I highly recommend that you retain a good insurance broker.

• Get personalized advice and quotes.
• Consider bundling, add-ons, and scheduling valuables.
• Remember that condo policy wordings vary and that cheap isn't always best.

I hope that Part 1 and this Part 2 will assist you in understanding some of the risks that you face and ways in which you might be able to transfer it to an insurance company. After all, having a break-in, water damage, a claim or another incident may be stressful enough. Don’t compound it by facing it and paying for it on your own.

Check out Part 1 in our Fall 2025 Edition

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Frank Palmay
Retired Lawyer
Former National Chair