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Insurance deductibles in condo buildings: the number that often isn't disclosed

5 min read · Ontario

Every Ontario status certificate contains a paragraph confirming that the corporation has secured the insurance policies the Condominium Act requires. Read quickly, it sounds like a settled item: the building is insured, next paragraph. But there is a number behind that sentence that the prescribed form never forces onto the page — the deductible — and it is one of the most consequential figures in the whole package.

What a deductible means in a condo building

The corporation's policy covers major damage to the building — fire, water, and the rest of the insured perils. The deductible is the amount of each claim the policy does not pay. When damage costs less than the deductible, or when the deductible portion of a large claim has to be funded, that money comes from somewhere inside the building's finances. Which budget it comes from, and when a deductible amount can be charged back to an individual owner — for example, after a leak traced to a unit — depends on the Act, the declaration, and the corporation's by-laws. How those rules would apply to a specific unit and a specific scenario is squarely a question for your own lawyer.

What makes the deductible worth hunting for is scale. A $5,000 deductible is an operating-budget nuisance. A six-figure deductible on water damage is a different kind of number — a single incident could consume a meaningful slice of a small corporation's annual budget, and the exposure sits there quietly whether or not a claim ever happens.

Six figures is no longer exotic

The clearest public data on how far condo deductibles have climbed comes from British Columbia, where the financial regulator studied the strata insurance market. BCFSA's findings: water-damage deductibles that were typically $25,000–$50,000 before 2019 climbed to $100,000–$750,000 and beyond by 2021, and market reporting based on that data indicates that more than 60% of B.C. stratas now face deductibles over $50,000, compared with roughly 15% in 2020. In older buildings or buildings with claims history, water deductibles of $250,000–$500,000 are documented.

Ontario's condo insurance market has not been through a squeeze as acute as B.C.'s, and B.C. numbers are not Ontario numbers. The reason to know them anyway: they show what happens to this figure when a building ages or accumulates claims, anywhere in Canada. The deductible is a live, moving number — which makes its absence from the disclosure form more notable, not less.

Where the number actually lives — when it appears

The status certificate's insurance paragraph confirms that policies exist. The deductible amount, if you can find it, lives in the attachments: the regulation requires the certificate package to include a certificate or memorandum of insurance for each current policy. Sometimes that document states the deductibles plainly, per peril — one figure for general damage, a larger one for water. Sometimes it confirms coverage in summary form and the deductible schedule is not there at all.

That second case is worth treating as a finding in its own right. "Deductible not disclosed" does not mean the deductible is high — it means a number that could range from trivial to six figures is not visible in the package you were given, during the one window when asking is easy.

Questions this suggests for your lawyer

The pattern to take away: the certificate proves the building is insured, but proof of insurance and knowledge of the deductible are different things. One is stated in the form; the other has to be found, and occasionally asked for. The asking is easiest while your conditions are still alive.

Sources

This article is general information about Ontario condominium documents — not legal advice. Always confirm anything important with your own lawyer.

CondoVitals is not a law firm and does not provide legal, financial, tax, or engineering advice. It provides general information to help you understand a document you already have, based on what that document discloses — it does not give a risk verdict, a guarantee, or an all-clear, and it cannot confirm reserve-fund adequacy without the full reserve study. It is not a substitute for advice from a licensed lawyer or other professional, and automated document reading can miss or misread information. Liability, where any applies, is limited to fees paid. Always confirm anything important with your own lawyer before you act.