Additional insurance premium payable by a co-owner : the court says no

November 13, 2021 - Insurance premiums (usually) increase after a loss. But to what extent? And if an additional insurance premium is attributable to the co-owner who is responsible for it, under a regulation in force in a co-ownership, can his syndicate claim it?

Justice Hélène Carrier of the Court of Québec (Small Claims Division) had to answer these two questions during a trial between a syndicate (plaintiff) and one of its co-owners. He claimed from the latter the sum of $7,000, because of a surcharge that he "claimed to have to assume", following a fire at the defendant's home.

Even though article 28 of its declaration of co-ownership states that "a co-owner is required to reimburse any additional insurance premium attributable to his personal act", the Tribunal held that the syndicate must, by  "preponderance of evidence", demonstrate the fault of the defendant, the damage suffered - that is, the increase in the insurance premium - and that this damage was directly related to the fire. What the applicant failed to do.

Five-year impacts

The syndicate estimated that this surcharge would be reflected in five consecutive years. But Jacques Beaudet, technical advisor for compensation for the Desjardins Group, came to contradict him. He explained that it cannot be "said that the insurance surcharge will have repercussions over five years, since "it can vary from three – five – seven years, it all depends on the insurers."

"Shop the premium"

In addition, the defendant questions the decisions of the syndicate, which did not "shop" for the insurance premium from various insurers, nor did it attempt to obtain, following the fire, an assessment of the premium for the main building burned.

In conclusion, Justice Hélène Carrier stated that under the Civil Code of Quebec "every monetary claim must be determined or determinable." However, "The evidence presented at the hearing was not convincing as to the assessment of this additional premium. By claiming a surcharge over a period of five years, without being able to quantify it, the Syndicate gives scope to the clause stipulated in Article 28 of the declaration of co-ownership that could be qualified as unfair. »

As the syndicate was unable to present preponderant evidence relating to the amount of the surcharge, the syndicate's claim was therefore dismissed.

To read the full judgment, click here.

Yves Joli-Coeur

Montreal, November 13, 2021