Your co-ownership is exposed to various risks, such as fire, water damage, theft and vandalism. When a loss occurs, the insurance of the co-ownership covers the immovable and the civil liability of the syndicate of co-owners.
The syndicate has the obligation to subscribe this type of insurance. The Law and the vast majority of declarations of co-ownership make it compulsory. The insurance contract describes the guarantees offered, their limits, exclusions, and the amounts of the deductibles.
Directors have a very important role in a co-ownership. They are the mandataries of the syndicate of co-owners and as such oversee the day to day operation of the immovable. It is therefore essential to possess a thorough knowledge of the tasks of this function. In the exercise of their duties the directors must act with care, diligence, loyalty and honesty, and always keep in mind the best interests of the group of co-owners.
Article 1085 of the Civil Code of Québec authorizes your Board of Directors to entrust a portion of its duties to a manager. The latter can be retained to manage the immovable which entails overseeing its preservation and maintenance, execute the decisions of the Board of Directors, settle major losses, subscribe and maintain the necessary insurance of your syndicate, and enforce the By-Law of the immovable
When you own an apartment in a co-ownership, you share the common portions, such as the roof, the lobby and the elevators in undivided ownership with the other owners. By the same token, you also share a portion of the liabilities attached to them.
Contrary to other jurisdiction, Québec Law does not compel a lessee to subscribe “home insurance” which, in the event of a loss, covers his property and his civil liability. This “negative-obligation” becomes a problem if your lessee causes damages to a third party and he is not insured. In such cases, the declaration of co-ownership can hold you (the co-owner) solidarily liable for the damages he has caused.
Your lessee is liable for any damages he causes during the term of the rental. Civil liability insurance covers him against material damages or bodily harm he may inflict (unintentionally) to third parties, and against faults committed by persons he accommodates or lodges in his dwelling. This insurance also covers damages that his property may cause to third parties. For example, it will cover water damage to your apartment generated by an overflowing washing machine, and also in a neighbor’s apartment.
An inescapable clause in most insurance policies, the deductible is an amount an insurer subtracts from the indemnities. The insured, in this case your syndicate of co-ownership, must then assume a portion of the cost of the building's repairs , from its working capital , or by the means of a special assessment (working capital call).
The insurance premiums are the amount paid by the insured monthly or annually to benefit in the event of a claim from the guarantees in the insurance policy. It is an expense towards the preservation, maintenance and administration of the immovable. Although the syndicate assumes this cost, it is charged back to the co-owners as a portion of their common expenses (condo fees).
The additional premium is a premium that is added to the existing premium. It results from a worsening of the risk or from the assumption of a new risk. This additional premium may be imposed during the course of a contract or upon its renewal. Risks are analyzed according to scales that are specific to each insurer. Ultimately, the syndicate will pay this additional premium, which will be charged to all of the co-owners through the common expenses (condo fees) or, at times, some of them.
The Law states that your syndicate's object, therefore its mission is "[...] the preservation of the immovable, the maintenance and administration of the common portions [...]." This implies that it has a duty to have carried out, over time, the work required to prevent the deterioration of the common portions of the immovable. The maintenance and conservation of its built up patrimony are therefore a must for any self-respecting co-ownership.
Legal fees may hold back those co-owners wishing to assert their rights. Legal expenses insurance overcomes this obstacle.
What is legal expense insurance?
This insurance allows the reimbursement, in part or in full, of lawyers' or notaries' fees to prevent or resolve a dispute. However, this guarantee is subject to pre-established conditions, deductibles and caps.
Insurance companies offering legal fees insurance can propose a lawyer, although it cannot impose him to you. You remain free to retain the lawyer of your choice.