The new law on co-ownership insurance takes another step forward

July 17, 2019 - The new law on co-ownership insurance took another step forward on July 17th with the publication of a draft regulation that will be open for comment for 45 days. The Minister of Finance may subsequently publish it, with or without modifications, considering the comments received.

This initiative stems from the adoption of Bill 141 in June 2018, so that the various co-ownership insurance products can better protect co-owners and syndicates of co-owners. This bill provided that six of the elements it contained would be adopted by government regulation. In the end, only four will be the subject of it. For the time being, at least.

Self-Insurance Fund

The creation of the self-insurance fund is one of the cornerstones of the planned new legislative provisions. It will therefore become mandatory some 24 months after the date of publication of the final regulation. In the end, the syndicates of co-ownership must have set it up over a maximum period of two years.

This fund must match the highest deductible of all insurance products subscribed by a syndicate. If it were to be used (during its capitalization), and more than half of its value were to be subtracted, a syndicate would have two years to replenish it. But if the amount drawn is less than half of the total amount to be capitalized, the grace period for replenishing it would be one year.

Compulsory insurance for all co-owners

In addition, this draft regulation provides for the compulsory subscription of a civil liability insurance for any co-owner. It proposes that the minimum coverage be $1 million (for any syndicate with less than 13 units), and $2 million for co-ownerships with 13 or more units.

Insurance covering the reconstruction cost is also in the government's sights. It is expected that only Chartered Appraisers of Quebec will be authorized to conduct this evaluation. The measure will come into force 12 months after the date of publication of the final regulation.

Risks covered

And finally, this draft regulation provides an exhaustive list of risks covered "by the sole effect of the law" in an insurance contract, including theft, fire, lightning, hail, explosion or vandalism. Not all syndicates will necessarily subscribe to all these protections, with the difference that from now on, an insurance contract will have to specify the coverage that is excluded. This will come into effect 12 months after the date of publication of the final regulations.

Overall, these regulations to be adopted respond to the recommendations made by the Regroupement des gestionnaires et copropriétaires du Québec (RGCQ), with the exception of the provisions relating to reasonable deductible and substantial loss, which are not included in this draft regulation. The latter will be specified in more detail tomorrow on


By François G. Cellier for

Montreal, July 17, 2019