Home Insurance

BC law does not itself mandate that homeowners carry home insurance, but mortgage lenders almost universally require proof of a homeowner's policy as a condition of advancing mortgage funds on the completion date. Without an active policy in place at closing, a lender can refuse to release funds, which would prevent the transaction from completing. Buyers purchasing without financing are technically free to forgo coverage, though doing so exposes them to significant financial risk.

No — standard BC homeowner's policies typically exclude overland water (flood), earthquake, and sewer backup as named perils. These coverages must be added separately by endorsement, and not all insurers offer every endorsement in every region of the province. Given BC's exposure to seismic activity and flooding events, buyers are encouraged to review their policy wording carefully and inquire about available endorsements with their insurer.

Insurers set the dwelling limit based on the estimated rebuild cost — that is, the cost to reconstruct the structure from the ground up, including materials and labour — rather than the property's market value. Market value incorporates land value, location, and market conditions, whereas rebuild cost reflects only the physical construction expense, so the two figures can differ materially. Homeowners should ensure their dwelling limit reflects a current reconstruction cost estimate to avoid being underinsured.

No — under the Strata Property Act (SBC 1998, c. 43), a strata corporation is required to obtain property and liability insurance for common property and the structure of the building, but this policy does not cover a unit owner's personal contents, improvements and betterments, or personal liability. Individual strata lot owners typically obtain a strata unit owner's policy (sometimes called "condo insurance") to cover their belongings, any upgrades made to the unit above the standard finish, and their personal liability. Strata corporation insurance deductibles can also be very high, and a unit owner's policy may cover the portion of a strata corporation deductible that the owner becomes responsible to pay under the strata's bylaws.

A deductible is the amount the policyholder must pay out-of-pocket before the insurer covers the remaining loss on a claim. In BC, deductibles vary significantly by insurer and by peril — water-related claims (such as sewer backup or overland water) often carry higher deductibles than claims for fire or theft. Policyholders should review their specific policy wording for each peril's deductible, as selecting a higher deductible generally reduces the premium but increases out-of-pocket exposure at the time of a claim.

Standard BC homeowner's policies generally provide very limited or no coverage for business property, business liability, or loss of business income arising from a home-based business. Owners who operate a business from their home — including rental activities beyond what the policy explicitly permits — should disclose this use to their insurer, as failure to disclose a material change in risk can affect the validity of a claim. A separate commercial or home-based business endorsement may be available depending on the nature of the business.

Renting a property to short-term guests constitutes a material change in risk that a homeowner must disclose to their insurer; many standard BC homeowner's policies exclude or void coverage when the dwelling is used as a short-term rental without a specific endorsement or separate landlord policy. Failure to notify the insurer of this change can result in a claim being denied. Owners should also be aware that short-term rental regulations vary by BC municipality, and some strata corporations prohibit short-term rentals under strata bylaws governed by the Strata Property Act (SBC 1998, c. 43).

Yes — a new owner must arrange their own home insurance policy, as a seller's homeowner's policy is personal to the seller and does not automatically transfer to a buyer upon a change of ownership. The mortgage lender will require confirmation that an active policy naming the lender as loss payee is in place on the completion date as a condition of advancing or maintaining funds. Buyers should arrange coverage before the completion date to ensure there is no gap in protection.

A BC real estate licensee may provide general information about the availability of home insurance but must be careful not to engage in insurance sales or advice, which is a regulated activity under separate provincial insurance legislation. Under the Real Estate Services Act (RESA) and BCFSA guidance, licensees must disclose any direct or indirect financial interest — such as a referral fee — they receive from recommending a service provider to a client. Receiving undisclosed remuneration for referrals can constitute a breach of a licensee's duties under RESA.

Most standard BC homeowner's policies contain a vacancy clause that suspends or significantly restricts coverage — particularly for perils such as water damage, vandalism, or glass breakage — if the dwelling is unoccupied beyond a specified number of consecutive days, often in the range of 30 days, though the exact threshold varies by policy wording. Homeowners who anticipate an extended vacancy (for example, during renovations, a lengthy absence, or while a property is listed for sale and not occupied) should notify their insurer and may need to obtain a vacancy permit or separate vacant property policy to maintain adequate coverage. Consulting the specific policy wording and the insurer directly is essential before leaving a property unoccupied.