Service Alberta recently put a halt to the regulation changes that were to be implemented under Phase II of the Condominium Property Amendment Act, citing that the changes would create too much red tape and cause an unnecessary burden to Alberta condo residents. Minister of Service Alberta, Nate Glubish, released a statement August 8th directing all Real Estate Council of Alberta (RECA) proposed policies, bylaws or regulatory changes to first pass through his office for review and approval.
Alberta has been working towards the Condominium Property Amendment Act for the past five years, with Phase II scheduled for implementation in July of this year. With intentions to modernize legislation, more than 50 amendments were previously approved to help protect owners and increase effectiveness for condo boards. However, in response to stakeholder backlash to the regulations, the current government has paused Phase II to ensure that Albertans are heard and protected.
“Our government has a mandate to cut red tape that creates unnecessary burdens for Albertans in their personal and business lives, and we are working hard to make sure Alberta is open for business and free of unwarranted red tape.”
Minister of Service, Nate Glubish on August 8, 2019
Between July 2019 and January 2020, the government plans to meet with key stakeholders to determine if the regulation changes imposed by the amendment act constitute “an excessive administrative burden or challenge for condo boards, owners, and corporation involved in the condominium industry.” The regulations are anticipated to come into effect January 1, 2020, after stakeholder feedback can be taken into consideration.
To read more about the Amendment Act and it’s three phases, see our previous blog post here.
Please see this press release from Service Alberta for more information: Statement from Minister
UPDATE – January 1, 2020
As of January 1, 2020, Standard Insurable Unit Descriptions are now required by all condominium corporations under the Condominium Property Amendment Act.
Normac offers Standard Insurable Unit Description services to help boards meet this requirement.
UPDATE – July 1, 2019
Phase II of the Condominium Property Act regulations have been paused for red tape review.
Service Alberta has placed all Phase II changes to the Condominium Property Act on hold. During a six month period between July 2019 and January 2020, Service Alberta will be meeting with key stakeholders to discuss the proposed regulation changes and make amendments based on the feedback provided. There may be further revisions made during this review period which will likely effect the amendments set for January 2020, including the Standard Insurable Unit Description.
Please see this press release from Service Alberta for more information: Press Release
Original post – May 7, 2019
Over the past few months, Albertans have been preparing for the next stage of the Property Amendment Act, effective January 2020. Arguably the most discussed update in the industry is the standard insurable unit description, and how this new bylaw requirement will affect condominiums and their insurance process. Our team at Normac is committed to providing the education, resources, and service to assist condominium boards with this new regulation.
What exactly is the Standard Insurable Unit Description?
The standard insurable unit description is a way for boards to clearly document what is covered under the corporation’s insurance and what is an improvement that must be covered by an owner’s insurance, for any particular unit.
Service Alberta defines this document as an inventory of the typical standard fixtures and finishing in a residential unit or a class of units. It can be provided either to purchases by the developer or created and adopted by the corporation. It is the responsibility of the condominium corporation to obtain insurance covering the unimproved or “standard” unit based on this description. Insurance for any improvements to the unit is the responsibility of the owner unless clearly stated otherwise in existing condominium bylaws.
The corporation must also define how many classes of units will be documented and, in the case of older properties, what the unit classes should include in terms of these fixtures and finishes.
Once documented, the Standard Insurable Unit Descriptions must be voted in to the corporations’ bylaws. As the purpose of this bylaw addition is to limit disputes between owners and the corporation, it is important that this description be handled with diligence and is completed in detail to best protect all parties. It is also important to consider how the description is written for the corporation and the language used – as it must be clear, consistent, and comprehensive in the cases where the description is needed or challenged.
How and when should we complete our Standard Insurable Unit Description?
According to the Act, the bylaw must be passed before the corporation’s first insurance renewal after January 2020 – giving condos at most, three years to complete the standard insurable unit description. Many corporations have taken the opportunity to begin planning for this regulation and seeking information and resources on how they may be able to complete these descriptions ahead of time. We recommend that all condominiums begin preparing and acquiring information and resources to have these documents completed as soon as possible.
Normac can help condo corporations with their Standard insurable Unit Description needs.
At Normac, we have been completing insurance appraisal across Canada for over 20 years now and have always included the standard insurable unit breakdown as part of our appraisal reports. With this new requirement by the Act in place, we have the expertise and skill-set and are uniquely positioned to assist condo boards with defining their standard insurable units. We offer a turn key solution that that will allow condo boards to focus on other areas required of them, while we take on the heavy-lifting of standard insurable unit definitions. We are committed to helping all our clients with this breakout description and will continue to work with other interest groups in industry such as legal practitioners, property managers, and insurance brokers collectively to ensure we are consistently offeringthe best solution for your condominium.
For more information on Standard Insurable Unit Definitions, click here.
To request a quote, click here.
To read more on Alberta Condominium Property Regulations, click here.